Research Paper No. 6: Monetary Policy Evaluation and Microstructure Analysis of the Haitian Foreign Exchange Market
- Monetary policy interventions have been effective in mitigating exchange rate volatility, but their impact is limited by structural economic challenges.
- Diaspora remittances contribute to the appreciation of Haiti's real exchange rate in the long term.
- The Haitian foreign exchange market is highly sensitive to past information and uncertainty.
- The spread between formal and informal exchange rates is influenced by trading volume and volatility.
This research paper, divided into four main studies, assesses the effectiveness of Haiti's monetary policy from 2017-2021 using a counterfactual analysis, examining the impact of interventions on exchange rate and price stability. It analyzes the relationship between diaspora remittances and the real exchange rate, estimating the equilibrium exchange rate and investigating deviations. The paper also delves into the microstructure of Haiti's foreign exchange market, focusing on volatility, spreads, and trading volumes, and their interrelationships. The overall aim is to provide insights for policymakers on managing exchange rate dynamics and promoting economic stability.
How to cite
Bank of the Republic of Haiti (BRH), 2024, Research Paper No. 6: Monetary Policy Evaluation and Microstructure Analysis of the Haitian Foreign Exchange Market, https://www.brh.ht/wp-content/uploads/Cahier_de_recherche_No6_15.pdf