Discussion Paper Details

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Title: The International Monetary and Financial System

Author(s): Pierre-Olivier Gourinchas, Hélène Rey and Maxime Sauzet

Publication Date: May 2019

Keyword(s): Exchange Rates, External assets and liabilities, Global financial cycle, International adjustment, International Currencies and Triffin dilemma

Programme Area(s): Financial Economics, International Macroeconomics and Finance and Monetary Economics and Fluctuations

Abstract: International currencies fulfill different roles in the world economy with important synergies across those roles. We explore the implications of currency hegemony for the external balance sheet of the United States, the process of international adjustment, and the predictability of the US dollar exchange rate. We emphasize the importance of international monetary spillovers, of the exorbitant privilege, and analyse the emergence of a new `Triffin dilemma'.

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Bibliographic Reference

Gourinchas, P, Rey, H and Sauzet, M. 2019. 'The International Monetary and Financial System'. London, Centre for Economic Policy Research.