Exchange Rate Assessments: CGER Methodologies

An emphasis on exchange rate surveillance-a topic that has always been at the core of the IMF's mandate-received renewed impetus in the IMF's Medium-Term Strategy (MTS), 1 that called inter alia for stronger emphasis on multilateral surveillance, macrofinancial linkages, and the implications of globalization, reflecting the stronger economic ties among member countries brought about by the rapid increase in international trade and financial integration. The exchange rate analysis conducted by the IMF's Consultative Group on Exchange Rate Issues (CGER)-which was formed in the mid-1990s with a mandate to provide exchange rate assessments for a number of advanced economies from a multilateral perspective-has accordingly been expanded to cover both key advanced economies and major emerging market economies. This paper summarizes the methodologies that underpin this expanded analysis.