We examine the role of sterilized FX interventions as a monetary policy tool in response to external shocks for dollarized emerging market economies. Our model highlights an agency problem that limits banks’ ability to secure funds in both domestic and foreign currencies, with its intensity linked to currency mismatches in the banking sector. This leads to endogenous deviations from the standard UIP condition, resulting in a non-neutral FX intervention policy. Sterilized FX interventions stabilize financial conditions not only by stabilizing real exchange rates but also by acting as a balance sheet policy that directly influences credit supply. Our quantitative analysis shows that FX policy rules that counteract exchange rate deviations reduce volatility in interest rate spreads including UIP deviations, credit, investment, and output, leading to significant welfare improvements compared to a flexible exchange rate regime.

We study the design of monetary policy when the public learns about the policymaker's preference for inflation stabilization. Relative to discretion, the optimal policy reacts more strongly: the central bank signals a stronger commitment to inflation stability, thereby anchoring short-run expectations and reducing the future cost of disinflation. Using cross-sectional variation of private forecasts about U.S. inflation and the output gap, we document that the data are consistent with the mechanisms highlighted in our model. A quantitative exercise shows that a simple delegation problem can provide a robust implementation of the optimal policy.

Why do two out of three Americans claim Social Security benefits before reaching their Full Retirement Age? Why do even sufficiently rich people claim early very often? This paper resolves this puzzling phenomenon by extending a standard incomplete markets life-cycle model to incorporate health dynamics and bequest motives. Relative to the existing literature, health plays a broader role, affecting not only medical expenses and mortality but also directly the marginal utility of consumption. This role of health is disciplined using microdata on consumption, assets, income, and health from the Health and Retirement Study (HRS) and the Consumption and Activities Mail Survey (CAMS). The calibrated model successfully replicates the fraction of early claimers. Counterfactual exercises show that health-dependent preferences and bequest motives are crucial for this result. The model’s success is explained by a novel channel that comes from the interaction between the negative effect of worsening health on the marginal utility of consumption, the downward health trend because of aging, and bequest motives. These two elements reduce the gains from delaying by 1) making individuals more impatient and 2) increasing the strength of bequest motives relative to future consumption. The results suggest that governments aiming to insure against longevity must consider the complementary interaction between individual incentives to insure against longevity and health risks.

En este artículo, se analizan los factores que determinan la Tasa de Interés Natural (TIN) y aquellos que explicarían su revisión a la baja para la economía peruana. Los autores destacan que esta variable es importante para la toma de decisiones de política monetaria así como para medir la posición de política de un país.

Bajo un esquema de Metas Explícitas de Inflación, la credibilidad del banco central es fundamental para la efectividad de la política monetaria. Así, mientras más creíble sea el banco central será más sencillo cumplir con su compromiso: la estabilidad monetaria. En este artículo, usando el Modelo de Proyección Trimestral, se discute la relación entre la efectividad y la credibilidad de la política monetaria.