Balancing reserves’ effectiveness and transparency

A fine balance: Eric Wolfe says there is such a thing as too much transparency

Many countries have built up a massive amount of foreign exchange (forex) reserves over the past decade, and the pace accelerated after the global financial crisis. While holding prudential reserves has been important for both crisis prevention and crisis mitigation, there has been less discussion about the effectiveness of reserves.

“In an atmosphere of algorithmic trading and electronic trading, we already know that intervention has limited effectiveness. And now intervention is more difficul

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