Quotation Breuss, Fritz, Roeger, Werner, in't Veld, Jan. 2008. Global Impact of a Shift in Foreign Reserves to Euros. European Economy, Economic Papers, Brussels, No. 345, November 2008.


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Abstract

This paper uses QUEST III, a multi-region global DSGE model, to study the effects of a gradual equalization of the portfolio composition of official foreign reserves between dollars and euros. We simulate a scenario of a shift in the composition of foreign reserves holdings from the present ratio of 65 percent dollars and 25 percent euros to equal 45 percent shares over a 10 years period. We assume imperfect substitutability between financial assets to allow this shift to have real effects. Our simulations point towards small real effects due to the reduction in real interest rates that results from this shift in official holdings.

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Publication's profile

Status of publication Published
Affiliation WU
Type of publication Working/discussion paper, preprint
Language English
Title Global Impact of a Shift in Foreign Reserves to Euros
Title of whole publication European Economy, Economic Papers, Brussels, No. 345, November 2008
Year 2008
URL http://ec.europa.eu/economy_finance/publications/publ_list24808.htm

Associations

People
Breuss, Fritz (Details)
External
in't Veld, Jan (European Commission, Belgium)
Roeger, Werner (European Commission, Belgium)
Organization
Institute for International Economics IN (Details)
Europainstitut (Badinger) (Former organization)
Research areas (Ă–STAT Classification 'Statistik Austria')
5115 European integration (Details)
5300 Economics (Details)
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