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Reserves

Hungary abandons euro peg

The Hungarian authorities have abandoned the forint's peg to the euro and moved to a floating exchange rate in a bid to lower inflation and speed up euro-accession.

IMF finds formula for trade-shock recovery

Real exchange rate depreciation, along with improvements in government stability and the institutional environment can lead to a speedy recovery from terms-of-trade shocks, research published by the International Monetary Fund finds.

Reserve managers look to derivatives

A survey by Central Banking Publications, sponsored by the Royal Bank of Scotland, has found that central bank reserve managers are still searching for yield after the recent credit turmoil, and that over half of those surveyed see derivatives as an…

Euro expectations stabilise currencies

Relatively stable market expectations for euro-locking rates have fixed the exchange rates of three central European currencies, research published by the National Bank of Hungary finds.

G7 ministers discuss IMF gold sales

"There was an acceptance among the G7 that resources should be raised by selling gold," said Tomasso Padoa-Schioppa, Italy's finance minister, who is also the head of the International Monetary Fund's (IMF) steering committee (IMFC).

Saudi must diversify investments, says top bank

The National Commercial Bank, Saudi Arabia's largest state bank, has called on the government to set up a sovereign wealth fund to cut the country's exposure to the greenback. The central bank should also look at de-pegging the riyal from the dollar.

Global slowdown may hamper US deficit financing

It may be harder to continue financing United States current-account deficits on such favourable terms if the recent wave of financial globalisation were to subside, research published by the New York Federal Reserve finds.

Currency flexibility needed for China's success

China will need exchange rate flexibility and, eventually, convertibility with open capital markets if it is to carry on succeeding as a large and diverse economy, says Maurice Obstfeld, an academic based at the University of California, Berkeley.

Renminbi revaluation would help dampen inflation

An appreciation of the renminbi against the greenback should lead to the Chinese authorities having more control over inflation, but would have little effect on the size of the United States trade deficit, says Marvin Goodfriend, an academic based at…

Subprime aftermath risks exacerbating imbalances

Financial market turbulence, together with a significant slowdown in the United States, could lead to and be exacerbated by a disorderly resolution of global current account imbalances, says the Bank of Canada's latest Financial System Review.

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