Part I Sustainablity of Macroeconomic Policies
Author: Ms. Corinne C Delechat
Language:
English
Keywords:
BOOK; CFA franc; WAEMU country; CEMAC country; WAMZ country; CEMAC member country; Real effective exchange rates; Imports; Tariffs; Real exchange rates; Terms of trade; Sub-Saharan Africa; West Africa; Africa; Asia and Pacific; East Asia

Abstract

Is there scope and need for monetary policy in CEMAC? Because CEMAC is a currency union with a fixed peg to the euro, at first glance the answer would appear to be “no.” However, the persistence of limited de facto capital mobility provides scope for monetary policy actions.1 As to the need, CEMAC is characterized by large real and nominal shocks, stemming for example from changes in the U.S. dollar-euro exchange rate, or from output and terms of trade fluctuations linked to oil production and world oil prices. Thus, there would be a rationale for short-term interventions to avoid potentially large and disruptive swings in consumption.

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Cover The CFA Franc Zone
The CFA Franc Zone
Common Currency, Uncommon Challenges
Author: Ms. Anne Marie Gulde and Mr. Charalambos G Tsangarides
ISBN:
9781589066755
Publication Date:
02 Apr 2008
Publisher:
International Monetary Fund
DOI:
https://doi.org/10.5089/9781589066755.071
Pages:
410