Disinflation and real currency appreciation in Chile and Mexico: the role of monetary policy
Chile and Mexico followed strategies of gradual disinflation during the 1990s, conducted their monetary policies in broadly similar ways, and experienced real currency appreciation. But the appreciation was larger in Mexico, which helps to explain its economic-growth underperformance. Motivated by these parallels and contrasts, the paper compares the conduct of monetary policy in the two countries through (a) a qualitative analysis of monetary policy episodes -episodes featuring a clear shift in the policy stance- and (b) the estimation of error-correction models for the interest rate, and identifies the specific traits of Mexico's monetary policy that contributed to the large appreciation of its currency.
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| Format: | Digital revista |
| Language: | English |
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Universidad Nacional Autónoma de México, Facultad de Economía
2008
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| Online Access: | http://www.scielo.org.mx/scielo.php?script=sci_arttext&pid=S0185-16672008000400003 |
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