Currency mismatches in chilean nonfinancial corporations

The potential financial vulnerability that can occur when private sector or government agents acquire high levels of foreign currency debt has been at the center of discussion since the financial crises that affected the countries of Southeast Asia in the late 1990s. To the extent that a mismatch is...

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Autores principales:	Cowan, Kevin, 1970-, Hansen S., Erwin, Herrera, Luis Oscar
Formato:	Artículo
Lenguaje:	eng
Publicado:	Banco Central de Chile 2019
Materias:	MERCADO FINANCIERO CRISIS FINANCIERA TIPO DE CAMBIO TASAS DE INTERÉS
Acceso en línea:	https://hdl.handle.net/20.500.12580/3711
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spelling	oai-20.500.12580-37112021-04-24T10:31:27Z Currency mismatches in chilean nonfinancial corporations Cowan, Kevin, 1970- Hansen S., Erwin Herrera, Luis Oscar MERCADO FINANCIERO CRISIS FINANCIERA TIPO DE CAMBIO TASAS DE INTERÉS The potential financial vulnerability that can occur when private sector or government agents acquire high levels of foreign currency debt has been at the center of discussion since the financial crises that affected the countries of Southeast Asia in the late 1990s. To the extent that a mismatch is generated in the denomination of assets and liabilities, foreign currency debt increases agents’ vulnerability to fluctuations in the exchange rate. After a depreciation, the debt-asset ratios increase, interest rates rise in relation to income and access to new debt is limited. For firms in the private sector (especially those that operate in the nontradable sector), these balance sheet effects reduce output and investment and, in extreme cases, lead to the bankruptcy of firms and financial instability. 2019-11-01T00:03:07Z 2019-11-01T00:03:07Z 2006 Artículo 956-7421-23-4 https://hdl.handle.net/20.500.12580/3711 eng Series on Central Banking, Analysis, and Economic Policies, no. 10 Attribution-NonCommercial-NoDerivs 3.0 Chile http://creativecommons.org/licenses/by-nc-nd/3.0/cl/ .pdf Sección o Parte de un Documento p. 207-252 application/pdf CHILE Banco Central de Chile
institution	Banco Central
collection	Banco Central
language	eng
topic	MERCADO FINANCIERO CRISIS FINANCIERA TIPO DE CAMBIO TASAS DE INTERÉS
spellingShingle	MERCADO FINANCIERO CRISIS FINANCIERA TIPO DE CAMBIO TASAS DE INTERÉS Cowan, Kevin, 1970- Hansen S., Erwin Herrera, Luis Oscar Currency mismatches in chilean nonfinancial corporations
description	The potential financial vulnerability that can occur when private sector or government agents acquire high levels of foreign currency debt has been at the center of discussion since the financial crises that affected the countries of Southeast Asia in the late 1990s. To the extent that a mismatch is generated in the denomination of assets and liabilities, foreign currency debt increases agents’ vulnerability to fluctuations in the exchange rate. After a depreciation, the debt-asset ratios increase, interest rates rise in relation to income and access to new debt is limited. For firms in the private sector (especially those that operate in the nontradable sector), these balance sheet effects reduce output and investment and, in extreme cases, lead to the bankruptcy of firms and financial instability.
format	Artículo
author	Cowan, Kevin, 1970- Hansen S., Erwin Herrera, Luis Oscar
author_facet	Cowan, Kevin, 1970- Hansen S., Erwin Herrera, Luis Oscar
author_sort	Cowan, Kevin, 1970-
title	Currency mismatches in chilean nonfinancial corporations
title_short	Currency mismatches in chilean nonfinancial corporations
title_full	Currency mismatches in chilean nonfinancial corporations
title_fullStr	Currency mismatches in chilean nonfinancial corporations
title_full_unstemmed	Currency mismatches in chilean nonfinancial corporations
title_sort	currency mismatches in chilean nonfinancial corporations
publisher	Banco Central de Chile
publishDate	2019
url	https://hdl.handle.net/20.500.12580/3711
work_keys_str_mv	AT cowankevin1970 currencymismatchesinchileannonfinancialcorporations AT hansenserwin currencymismatchesinchileannonfinancialcorporations AT herreraluisoscar currencymismatchesinchileannonfinancialcorporations
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Currency mismatches in chilean nonfinancial corporations

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