; ; ; "ActiveFedora::Aggregation::ListSource" . a , ; "Exchange Rate Policies at the Zero Lower Bound"; ; "batchuser@example.com"; "Bianchi, Javier", "Bocola, Luigi", "Amador, Manuel", "Perri, Fabrizio"; "Federal Reserve Bank of Minneapolis"; "International reserves", "Currency pegs", "Negative interest rates", "Capital flows", " Foreign exchange interventions", "CIP deviations"; "F31 - Foreign Exchange", "F32 - Current Account Adjustment; Short-term Capital Movements", "F41 - Open Economy Macroeconomics"; "Recently, several economies with interest rates close to zero have received large capital inflows while their central banks accumulated large foreign reserves. Concurrently, significant deviations from covered interest parity have appeared. We show that, with limited international arbitrage, a central bank's pursuit of an exchange rate policy at the ZLB can explain these facts. We provide a measure of the costs associated with this policy and show they can be sizable. Changes in external conditions that increase capital inflows are detrimental, even when they are beneficial away from the ZLB. Negative nominal rates and capital controls can reduce the costs. "^^; "2017-10-02"; "2019-05-20T18:20:39.355067587+00:00"^^; "https://doi.org/10.21034/wp.740"; ; "https://creativecommons.org/licenses/by-nc/4.0/"; "2020-07-09T14:08:35.959247467+00:00"^^; "https://creativecommons.org/licenses/by-nc/4.0/"; "Research Paper"; "80", "90", "22", "601"; "Working paper (Federal Reserve Bank of Minneapolis. Research Department)"; "740"; "International reserves", " Foreign exchange interventions", "Negative interest rates", "Currency pegs", "CIP deviations", "Capital flows"; ; ; ; ; "Federal Reserve Bank of Minneapolis. Research Department"; "Published in _The Review of Economic Studies_ (Vol. 87, Iss. 4, July 2020, pp. 1605-1645), https://doi.org/10.1093/restud/rdz059."^^; ; "Publication" . ; .