Integrated Policy Framework Presentation.pptx

Integrated Policy Framework Presentation

1. Progress towards an Integrated Policy Framework Presentation for IMF-SNB-JVI Workshop for CCAMM-CBP in Vienna JuNE 14, 2023 Christopher Erceg International Monetary Fund These views are my own, and do not necessarily reflect those of IMF Staff, IMF Management, or the Executive Board

2. Structure of discussion Brief overview of the IPF Moving to more granular policy advice An overview of the IPF quantitative model and applications Challenges and Next Steps

3. Brief overview of the IPF

4. Motivation for the IPF International capital flows can provide significant benefits, but can also pose challenges Policy rate and exchange rate flexibility may not always be satisfactory, especially in case of frictions and vulnerabilities that many EMs and LICs face, for example: Shallow FX markets Sizable balance sheet currency mismatches Poorly anchored inflation expectations

5. Motivation (continued) Many countries in practice use a mix of different tools: Macroprudential Policy Measures (MPMs) FX Intervention (FXI) Capital Flow Measures (CFMs) But there hasn’t been a clear framework guiding the integrated use of these tools