(5/4/2015) Trade is now high on the agenda in Washington. President Obama is pushing hard for Congress to give him Trade Promotion Authority (TPA), once known as fast-track authority.
Give Obama Trade Promotion Authority
Category Archives: exchange rates
Devaluations are Often Associated with Changes in Government
(4/16/2015) The possibility of devaluation is apparently an issue in the upcoming Argentine elections. (The forward rate for next year is about 13 pesos per dollar, which is close to the informal rate and suggests a big devaluation relative to the current official exchange rate of 8.) In this connection, an Argentine newspaper has asked me about “Contractionary Currency Crashes,” a paper that I presented as the 5th Mundell-Fleming Lecture of the IMF’s Annual Research Conference.
Does the Dollar Need Another Plaza?
(3/23/2015) We are at the 30th anniversary of the 1985 Plaza Accord. It was the most dramatic intervention in the foreign exchange market since Nixon originally floated the US currency. At the end of February 1985 the dollar reached dizzying heights, which remain a record to this day. Then it began a long depreciation, encouraged by a shift in policy under the new Treasury Secretary, James Baker, and pushed down by G-5 foreign exchange intervention. People remember only the September 1985 meeting at the Plaza Hotel in New York City that ratified the policy shift; so celebrations of the 30th anniversary will wait until this coming fall.