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Post-Crisis Exchange Rate Policy in Five Asian Countries: Filling in the "Hollow Middle"?
Author:
Mr. Leonardo Hernández null

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and
Mr. Peter J Montiel
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Series:
IMF Working Papers
Volume/Issue:
Volume 2001: Issue 170
Language:
English
Publication Date:
01 Nov 2001
DOI:
https://doi.org/10.5089/9781451858426.001
ISBN:
9781451858426
ISSN:
1018-5941
Pages:
41
Keywords:
WP; exchange rate regime; foreign exchange market; crisis country; exchange rate policy; regime continuum; exchange rate movement; exchange rate variability; crisis exchange rate policy; exchange rate fluctuation; Exchange rates; Exchange rate arrangements; Currency markets; Asia and Pacific
Legal-disclaimer:
IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.
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Following the 1997-98 financial turmoil, crisis countries in Asia moved toward either floating or fixed exchange rate systems, reinforcing the bipolar view of exchange rate regimes and the "hollow middle" hypothesis. But some academics have claimed that the crisis countries' policies have been similar in the post- and pre-crisis periods. This paper analyzes the evidence and concludes that, except for Malaysia, which adopted a hard peg and imposed capital controls, the other crisis countries are floating more than before, though less than "real" floaters do. Further, the crisis countries' policies during the post-crisis period can be justified on second-best arguments.
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Cover IMF Working Papers
IMF Working Papers
ISSN:
1018-5941
Publisher:
International Monetary Fund