Using An EC-Wide Monetary Aggregate in Stage Two of EMU

July 1, 1992

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Format: Chicago

Peter B. Kenen, and Tamim Bayoumi. Using An EC-Wide Monetary Aggregate in Stage Two of EMU, (USA: International Monetary Fund, 1992) accessed November 21, 2024

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

This paper looks at whether the aggregate ERM money supply has been a useful predictor of short-term changes in inflation and growth, and long-term trends in price levels among the core ERM countries. The evidence suggests that over the period since 1987, when there have been no realignments, the ERM money supply performs at least as well, and arguably better, than the individual national aggregates in predicting nominal aggregates such as inflation and the price level, while neither money supply is a good predictor of real activity.

Subject: Exchange rates, Foreign exchange, Industrial production, Inflation, Monetary aggregates, Monetary base, Money, Prices, Production

Keywords: Aggregate ERM series, Core ERM country, ERM aggregate, ERM country, ERM monetary aggregate, ERM money supply, ERM parity, Exchange rates, Global, Industrial production, Inflation, Monetary aggregate, Monetary aggregates, Monetary base, Monetary policy, Money supply, Money supply granger, WP

Publication Details

Pages:

20
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 1992/056
Stock No:

WPIEA0561992
ISBN:

9781451847673
ISSN:

1018-5941

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