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Taking Stock of Monetary and Exchange Rate Regimes in Emerging Europe

Academic & Research
The CEU Campus
Thursday, March 9, 2017, 5:00 pm – 7:00 pm

The Business School, the Department of Economics and the Political Economy Research Group cordially invite you to a lecture by Johannes Wiegand of the IMF Open-Economy Macroeconomics Division.


Abstract A full quarter century after the transition from socialism, almost every type of monetary and exchange rate regime can be found in Central, Eastern and Southeastern Europe (CESEE): from free floating and inflation targeting over various soft and hard pegs to the unilateral use of the euro and full euro area membership. Why are CESEE’s monetary regimes the way they are? How have they performed, and what makes a regime “right” for a country? Looking ahead, how can monetary regimes assist in addressing the economic challenges countries are likely to face? If a country’s current exchange rate regime seems suboptimal, could it switch, and how?

This paper reassesses monetary and exchange rate regimes in CESEE. The first part takes stock, by (i) reviewing the evolution of exchange rate regimes since transition, (ii) assessing the regimes’ performance, in particular for the past 15 years or so, and (iii) analyzing obstacles to more exchange rate flexibility, especially financial euroization. The second part is forward looking and sketches strategic monetary policy options, in particular for CESEE economies currently on fixed exchange rates. 


Bio Johannes Wiegand is Deputy Chief of the Open-Economy Macroeconomics Division in the IMF’s Research Department. He worked previously in the IMF’s European Department as Deputy Chief of the Emerging Economies Division; Mission Chief for Croatia and Kosovo; and Desk Officer for Hungary during the financial crisis. Prior to joining the IMF, Mr. Wiegand taught at the London School of Economics and wrote leaders for the Financial Times and Financial Times Deutschland. He holds a PhD in Economics from University College, London.


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