BOI holds an international conference on foreign exchange market intervention

  • An international conference organized by the Bank of Israel, in collaboration with the central bank of Switzerland (SNB) and the Centre for Economic Policy Research (CEPR) on “Foreign Exchange Market Intervention: Conventional or Unconventional Policy?” took place in Jerusalem on December 7–8, 2017.
  • At the conference, research papers were presented by researchers from various countries. The researchers serve in a range of positions in academia, central banks (including the Bank of Israel) and in other international institutions. In addition, there was a keynote lecture by Professor Maurice Obstfeld, Economic Counsellor and Director of Research at the IMF, and a professional panel on monetary policy instruments was held, with the participation of representatives of central banks.

 

The international conference held by the Bank of Israel, in collaboration with the central bank of Switzerland (SNB) and the Centre for Economic Policy Research (CEPR) on “Foreign Exchange Market Intervention: Conventional or Unconventional Policy?” took place in Jerusalem on December 7–8, 2017. Researchers from academia, central banks, international institutions from around the world, as well as Bank of Israel representatives, participated.

 

Governor of the Bank of Israel Dr. Karnit Flug, in her opening remarks to the conference, said that the Bank of Israel intervenes in the foreign exchange market to prevent, to the extent possible, the undesired negative effects on exports, by moderating the overappreciation of the shekel. The Governor emphasized that the policy is sufficiently flexible to allow the economy’s fundamental forces to be expressed nonetheless, as was reflected in the cumulative appreciation of approximately 20 percent in the exchange rate since the beginning of 2009.

 

Economists from the SNB, the Bank of Israel, the IMF, as well as from leading universities worldwide, presented and discussed research dealing with theoretical and empirical aspects of central bank intervention in the foreign exchange market and in  exchange rate policy.

 

Professor Maurice Obstfeld, Economic Counsellor and Director of Research at the IMF, gave the keynote lecture, in which he reviewed the main dilemmas of policy, given the tension between basic goals of monetary policy—macroeconomic stability and financial stability considerations.

The conference’s first day concluded with a professional panel led by Andrew Filardo of the BIS, with participation by representatives of the central banks of the Czech Republic, Denmark, Iceland, and Israel—all small and open economies, though with different characteristics of foreign exchange market policy.

 

Professor Alex Cukierman, a past member of the Bank of Israel’s Monetary Committee, addressed the conference and reviewed the similarities and differences in foreign exchange market policies between Israel and Switzerland.

 

The papers presented at the Conference are available at the Bank of Israel website:

 

https://www.boi.org.il/en/Research/ConferencesAndSeminars/Pages/december2017.aspx

​​