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exchange rates

Low oil prices and monetary policy in developing countries: Mind the gap!

Ayhan Kose's picture
Excluding a handful of oil exporters or countries where sharply depreciating currencies or domestic factors caused inflation to soar, developing country inflation has fallen quite significantly over the past few months and is expected this year to be at its lowest level since 2009 (Figure 1). The broad-based pattern of slowing inflation has been largely driven by plunging oil prices, albeit to varying degrees reflecting in particular exchange rate developments, the extent of fuel subsidies and other price regulations.

Prospects Daily: US consumer confidence falls; inflation moderated in Chile, Peru and Mexico but rose slightly in Brazil

Global Macroeconomics Team's picture

Financial Markets…U.S. Treasuries slid for the first time in four days, with the benchmark note yields 3 basis points to 1.62%, as a government report showed U.S. employers added more than forecasted jobs in November. U.S government bonds have advanced 2.8% this year as of yesterday, after gaining 9.8% in 2011 and 5.9% in 2010.

China’s economic outlook remains favorable

Louis Kuijs's picture

The World Bank released its latest Quarterly Update on China’s economy on Friday (for disclosure's sake: I’m the lead author). At the press launch, there were a lot of questions about the recent wage hikes in several foreign-owned manufacturing companies and the possible concerns these have triggered among many about possible loss of competitiveness and/or a wage-inflation spiral.

Mexico remittances increase as the Peso weakens

Sanket Mohapatra's picture

The Mexican central bank's latest data release shows that remittances to Mexico increased by 13 percent in October on a year-on-year basis. This comes after a widely-reported 12 percent year-on-year drop in August and (less widely reported) flat growth in September. 

A recent AP article attributes this increase to the depreciation of the Mexican Peso against the U.S. dollar:

Is China overwhelmed by capital inflows?

Louis Kuijs's picture

The question of whether China is overwhelmed by capital inflows has been asked for quite a while now. If a question continues to be asked, there is probably a good reason for it. Whether the answer is yes or no depends on how you look at it.