Theme, Keynote, Journal

Theme

Recent Trends in International Reserves: Theory and Evidence

Subject

There has been a recent upward trend in central banks’ holdings of international reserves. What are the causes and the consequences of such a trend? Do central banks aim at building buffers as an insurance against shocks (sudden stops, capital flight or a fall in commodity prices)? Do they seek to alter the real exchange rate? Is foreign exchange intervention a mean to conduct standard monetary policy despite the zero lower bound constraint? Do countries have large international reserves to retain some autonomy in the conduct of monetary policy with a flexible exchange rate and open capital accounts? Or is the accumulation of international reserves a tool for financial stability? Does the accumulation of international reserves spur inflation and private debt? How does climate change or the COVID-19 pandemic affect the accumulation and use of reserves?


Topics (include – but are not limited to):

  • The optimal level of international reserves

  • International reserves as a tool for macroprudential policy

  • Current account imbalances, net foreign assets and international reserves

  • The zero lower bound, the trilemma and international reserves

  • The role of reserves in the international transmission of shocks

  • The consequences of increasing holdings of foreign exchange reserves

  • Climate change and international reserves

  • Cryptocurrencies, central bank digital currencies and international reserves

  • The COVID-19 pandemic and international reserves


Keynote speaker

Gianluca BENIGNO (Federal Reserve Bank of New York)


Special issue

Selected papers will be considered for publication in a special issue of Open Economies Review. Here is the updated call for submissions to this special issue.