BIS Review 49/2008  5  The main advantage of adopting a domestic nominal anchor instead of committing to an external one is that it provides for more flexibility in times of need (Barajas et al 2007). This flexibility helps to adjust to the different forces that impinge on emerging market economies’ monetary policy in their process of convergence and integration.
At the current juncture, such a need might arise as countries are facing increasing inflationary pressures. III.