Preventing Financing Crises: The Chilean Perspective

Preventing Financial Crises: The Chilean Perspective

- Speaker: Carlos Massad, President, Central Bank of Chile

- Date : November 16, 2001.

"I must say that the crawling band mechanism and the URR both fulfilled the role for which they were created. The crawling band mechanism provided enough room to smoothly accommodate an exchange rate appreciation without immediate disruptions in the current account. On the other hand, the use of the unremunerated reserve requirement proved to be effective in altering the composition of capital flows towards medium- to long-term inflows, and in enhancing the independence of domestic monetary policy...”