As discussed in class, you will pick a developing country, or perhaps two for comparison, and see how their monetary policy policy, forex, and microprudential response to the pandemic matches up with the thoughts of the IMF.
The paper topic is simply this: You know what the US and most developed countries have been doing to steer their economies through the pandemic storm. What have other nations been doing, and how have they succeeded? In particular, we know that nations with fixed exchange rate regimes have more limited options for monetary policy. Has that been a problem for their economies? The IMF has compiled a good resource to provide reliable info. You’ll find it here:
(Links to an external site.)
This might be helpful too:
You are not to write the definitive report on this topic, of course, but rather pick a country that interests you for whatever reason and examine their policies, successes and failures to draw tentative conclusions. Make sure you examine the results in context: in other words, don’t compare 2020 to 2019 – that would be an unfair comparison.
What the professor said in class:
Review the chosen country’s foreign exchange and monetary policy approaches during this pandemic.
Might not be just money and exchange rates. It might also be their borrowing capital flows (some countries are in really bad trouble and dont have any health to lean on)
Evaluate the country in terms of how they’re handling the monetary policy through this crisis, what stress does that put on their exchange rate what stress is the pandemic itself putting on their exchange rate and what they’re doing so far, as macro potential policy is concerned, and come to some conclusion, based on what we know about the theory of all these topics.
Does it look like they are handling it the pandemic well or are they stumbling. If they are stumbling, did things look better a year ago than they do now or are they better now. Or do they look better now than they did a year ago and did they learn from the last 12 months.
I would like to review Turkey’s economic response to the pandemic. The Turkish lira has depreciated greatly(!) in the last few years and the pandemic made the situation even worse.
I uploaded an additional file that our professor made us read for the purpose of this assignment down below.