Local currency debt not enough to escape US dollar influence – BIS paper


Emerging markets may not be able to escape the influence of the US dollar even if they borrow in domestic markets using their own currency, according to a new Bank for International Settlements working paper.

In Bond risk premia and the exchange rate, authors Boris Hofmann, Ilhyock Shim and Hyun Song Shin study how shifts in domestic interest rates affect the willingness of international investors to hold bonds issued in domestic currency.

They find an appreciation of an emerging market

To continue reading...

You need to sign in to use this feature. If you don’t have a Central Banking account, please register for a trial.

Sign in
You are currently on corporate access.

To use this feature you will need an individual account. If you have one already please sign in.

Sign in.

Alternatively you can request an individual account here: