Número:
941
Publicado:
Clasificación JEL:
C58, E44, G11, G14
Palabras clave:
Portfolio Balance Channel, Sovereign Credit Rating, Uncovered Interest Rate Parity, Monetary Trilemma

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Luis Fernando Melo-Velandia, Daniel Parra-Amado, Juan Pablo Bermúdez-Cespedes
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In this paper we study exchange rate effects due to shifts in the portfolio composition of the Colombian financial sector during 2003-2014. We first provide a theoretical understanding of the channel's transmission mechanism by modeling how the banking