In mid-January 1990, Brazil abandoned its crawling exchange rate band. Surprisingly enough, the country's economic performance in the aftermath of this episode was much better than expected, given the performance of other emerging market economies after a move toward floating. Despite the large ...

Since the implementation of the Real Plan of 1994, the Brazilian economy has been in the process of reducing its degree of indexation. For more than three decades, Brazilian wages, rents, financial securities, and other contracts were indexed to the price level. The frequency of adjustment sometimes ...

Does tight monetary policy stabilize the currency after a collapse?. Does the effect of high interest rates on the exchange rate depend on the condition of the banking system? The East Asian crises and other recent currency crises have put these questions at the center of economic policymaking decisions.