Globalisation and monetary policy in emerging markets

BIS Papers No 23
May 2005

Overview

Global financial integration has substantially increased in recent decades. Initially, it manifested itself in growing capital flows between developed countries. In response to the removal of capital controls, financial innovation and technological progress, financial integration has subsequently spread to emerging market countries. Gross and net capital flows between developed and emerging economies have increased. Financial integration has also been evident in frequently high correlations between asset yields or prices, particularly for certain asset classes such as high-yield corporate bonds and sovereign bonds and equities in developed and emerging markets.

Background papers	Page
Financial integration: an overview (PDF: 8 pages, 96 kb) Palle Andersen and Ramon Moreno	1
The increased role of foreign bank entry in emerging markets (PDF: 8 pages, 48 kb) Ramon Moreno and Agustin Villar	9
Has globalisation reduced monetary policy independence? (PDF: 42 pages, 249 kb) M S Mohanty and Michela Scatigna	17
Globalisation and monetary operations in emerging economies (PDF: 22 pages, 176 kb) John Hawkins	59
Local complications of global economic integration: privatisation receipts and volatile export earnings (PDF: 10 pages, 108 kb) Dubravko Mihaljek	81
Papers presented
International capital flows in Argentina (PDF: 7 pages, 122 kb) Pedro Lacoste	91
Brazil's stress test of inflation targeting (PDF: 11 pages, 93 kb) Afonso S Bevilaqua and Eduardo Loyo	98
Monetary policy and financial integration: the case of Chile (PDF: 11 pages, 93 kb) Rodrigo Cifuentes and Jorge Desormeaux	109
Challenges to China's monetary policy (PDF: 4 pages, 36 kb) People's Bank of China	124
Capital controls and foreign exchange market intervention in Colombia (PDF: 13 pages, 92 kb) José Darío Uribe	128
Conducting monetary policy in a small open economy under globalised capital markets: the experience of the Czech Republic (PDF: 9 pages, 108 kb) Jirí Böhm and Vladimír Zdárský	141
The recent appreciation of the Hong Kong dollar (PDF: 6 pages, 48 kb) Research Department, Hong Kong Monetary Authority	150
Monetary policy issues in Hungary on the eve of EU membership (PDF: 5 pages, 90 kb) Gergely Kiss	156
Globalisation, financial markets and the operation of monetary policy in India (PDF: 10 pages, 66 kb) Rakesh Mohan	161
Indonesian policy on non-residents' participation in the money market: the restriction of rupiah transactions by non-residents and foreign currency credit offered by banks to non-residents (PDF: 5 pages, 59 kb) Hartadi A Sarwono	171
Globalisation and its effects on monetary policy: the case of Israel (PDF: 10 pages, 291 kb) Meir Sokoler	176
The effects of financial globalization on the Korean financial markets and monetary policy (PDF: 23 pages, 247 kb) Kyuyung Chung	186
Globalisation and the operation of monetary policy in Malaysia (PDF: 7 pages, 78 kb) Latifah Merican Cheong	209
Policies for international reserve accumulation under a floating exchange rate regime: the experience of Mexico (1995-2003) (PDF: 14 pages, 1,360 kb) José Julián Sidaoui	216
Challenges of financial globalisation and dollarisation for monetary policy: the case of Peru (PDF: 12 pages, 230 kb) Julio Velarde	230
The composition and management of capital flows in the Philippines (PDF: 18 pages, 104 kb) Amando M Tetangco, Jr	242
Globalisation, financial markets and the operation of monetary policy: the experience of Saudi Arabia (PDF: 3 pages, 30 kb) Muhammad Al-Jasser and Ahmed Banafe	260
The impact of globalisation on the formulation and implementation of monetary policy in Singapore (PDF: 6 pages, 42 kb) Ong Chong Tee	263
Globalisation, financial markets and the operation of monetary policy: the case of Thailand (PDF: 6 pages, 49 kb) Thirachai Phuvanatnaranubala	269
High public debt, multiple equilibria and inflation targeting in Turkey (PDF: 6 pages, 41 kb) Fatih Özatay	275