Monetäre Wirkungen eines Multiwährungs-Interventionssystems mit Saldenausgleich

Abstract

Monetary Effects of a Multi-Currency Intervention System with Settlement of Net Surpluses and Deficits A study illustrated by the European Floating Block

As a result of the adoption of block floating in the EEC, the participating countries have regained a substantial portion of their autonomy with respect to stabilization policy. There is no question, however, that this has made national monetary policy completely independent of monetary developments in European partner countries. This is mainly due to the fact that under certain conditions the intervention and settlement agreements in force within the Community may have direct and, so to speak, “automatic” consequences for supplies of liquidity in Community currencies and hence for the monetary policy of the affected countries. This study deals with the monetary effects of such a system as it has existed in the EEC since 1972. First, it considers the fundamental modus operandi of the European floating block system. Then follows an analysıs of the effects this system may have on international supplies of money. First, the effects are analysed for normal operation of the system, using a simplified example, and then for application of various exceptional arrangements. It proves that in most cases, even after the financing of the settlement of surpluses and deficits, considerable net expansive or contractive effects on the international circulation of money in the affected currencies still remain (“pure net liquidity effects”). In some cases interim hquidity- increasing or liquidity-skimming effects occur, which are cancelled out, however, by the mode of financing the settlement of surpluses and deficits (“time-lag effects”). These changes in the international supply of Community currencies take full effect on the national supply of money. From the standpoint of monetary policy-makers, both the net liquidity effects and the timelag effects are probably undesirable, as they run counter to the strategy of monetary policy; only in certain special cases can the effects of the European floating block be considered welcome. The question therefore arises of whether the central banks of the countries concerned should attempt to prevent or compensate for the effects of the system. While there seems to be hardly any prospect of success in the case of the time-lag effects, monetary policy measures to counter the net liquidity effects are quite possible. But this influences only the effects, not the causes of the intervention, and there is a risk of repetition of the entire process. Exchange-rate policy measures might be a remedy, but would break up the system itself. In the final analysis, the European floating block system onceagain raises the old problem of the incompatibility of fixed exchange rates on the one hand and different economic development in various countries on the other. In its present inadequate form it is more likely, also in the future, to contribute to jeopardization rather than strengthening of European integration.