-
Integrated Policy Framework—Principles For The Use Of Foreign Exchange Intervention
This note guides policy advice on the use of foreign exchange intervention (FXI) as part of the Integrated Policy Framework (IPF) in Fund surveillance. It brings together insights from the conceptual and quantitative IPF models (e.g., Basu and others, 2020, Adrian and others, 2021), with additional considerations from the empirical literature and the practical challenges faced by central banks. This framework allows for the advice to differ with country-specific shocks, frictions, and initial conditions, while ensuring consistency of approach in the surveillance of countries with floating exchange rates. The IPF ... (full story)