3110 Minimum import prices

Petrol is being sold in very limited amounts.

Revised Rates Adjustments of policy 1992 1993

Meanwhile, import prices remained more or less stable.

Effects of changes in rates of exchange and inflation

Effect of changes in rates of exchange and inflation

Effects of changes in rates of exchange and inflation

The yen s weakening will mean higher import costs, and therefore a higher rate of inflation.

Revised estimates effect of changes in rates of exchange and inflation

Effects of changes in rates of exchange and inflation

d Combined effect of inflation and exchange rate changes.

b Combined effect of inflation and exchange rate changes.

Additional expenditures deriving from inflation and currency fluctuations

The factors underlying that decline have been depressed demand, declining food prices, falling mortgage rates and a strong exchange rate, which prevented the large grain imports resulting from the drought to feed into the inflation rate.

A. Effects of changes in the operational rates of exchange and rates of inflation

Faced with high inflation, Thatcher backed a monetarist approach that supported high interest rates and succeeded in sharply reducing inflation.

Mortgages are available at outrageously high interest rates.

Indeed, many countries are already experiencing an increase in import prices for biological resources.

Revised estimates effect of changes in rates of exchange and inflation

As concerns about deflation replaced fear of inflation, gold prices started to fall with the correction in commodity prices.

That expected inflation rate is consistent with the difference in interest rates between ordinary US government bonds and Treasury Inflation Protected Securities.

The result will be to raise the prices of China s exports and fuel demand for imports.

As a result, China s inflation, as well as asset prices, remain under control.

A further drop in the real rate of exchange in 1993 decreased the cost of imports and increased that of exports, making it difficult to correct the trade balance.

In the US, the inflation rate has also been depressed by the rise in the value of the dollar relative to the euro and other currencies, which has caused import prices to decline. This, too, is a level effect, implying that the inflation rate will rise once the dollar's exchange rate stops appreciating.

Central banks respond to lowered demand by reducing interest rates and to higher expected inflation by raising interest rates.

Its nominal interest rates will rise as bondholders fear inflation.

History shows that rising inflation is eventually followed by higher nominal interest rates.

Even with the prevalence of dollar indexation across the region, exchange rate appreciation would still help promote cheaper imports and higher living standards.

A less obvious effect is whether that will reduce the demand for Chinese imports or whether that will have any impact on American inflation.

The increase of import unit values by 3.2 per cent in 1992 was essentially due to the rise in the prices of manufactured goods exports, which averaged 4.6 per cent despite the fact that inflation has fallen to moderate levels in the industrial countries.

Soaring energy prices, for example, have become a leading inflation risk.

It's more expensive to transport goods. Prices of goods go up, inflation is affected.

In short, there are better ways than gold to hedge inflation risk and exchange rate risk.

Higher rates would have meant lower inflation, so that inflationary expectations would not be the issue they have become.

Second, it increases global asset demand, generating asset price inflation.

On January 2, 1992, Moldova introduced a market economy, liberalizing prices, which resulted in rapid inflation.

Our economies are marked by budgetary and trade imbalances and large import reductions, aggravated by the drop in the price of raw materials.

Overvalued currencies, coupled with the process of trade liberalization that had taken place in Latin America, led to a strong increase in imports.

Looking forward, investors can protect themselves against inflation in the US by buying Treasury Inflation Protected Securities (TIPS), which index interest and principal payments to offset the rise in the consumer price level.

Estimated exchange rates, inflation rates and salary costs were used as provided by the field offices.

Now, let's talk about the debt. Today, interest rates are low, lower than the rate of inflation.

Inflation implies higher long term interest rates until markets regain confidence in the central bank.

When the central bank succeeded, it lowered those rates and the economy bounced back.

17.1 Explanations regarding the changes in respect of rates of exchange and inflation may be found in the main document and are not repeated here.