I intend focusing on one of the topics flagged for discussion in this session by the organizers, namely “Is there scope for co-operation or co-ordination on exchange rate policies over the long term?” In this brief presentation, I propose to explore the following areas: First, changing dynamics of exchange rate regimes in Asia; second, importance of the Asian economies for global prosperity and stability; third, the Asian dynamics of financial integration, fourth, the scope for co-operation or co-ordination on exchange rate policies; and finally, some thoughts specific to the Indian situation.
Communication and the effectiveness of monetary policy Although people often speak of the Federal Reserve as controlling interest rates, in fact the Fed directly affects only one very short-term and (in the scheme of things) relatively unimportant interest rate, the federal funds rate.