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International Monetary Fund

in the liquidity environment, several governments have adjusted their fiscal financing plans and some central banks have used available monetary instruments to manage emerging liquidity pressures. With oil prices expected to remain lower than in the period before mid-2014 and fiscal adjustment likely to proceed gradually, central banks in the region have been keen on upgrading their liquidity management frameworks to effectively address potential liquidity pressures. At the same time, with individual banks in different liquidity positions, the interbank markets

International Monetary Fund
Effective liquidity management is important to promote macro-financial stability in the GCC countries. Fixed exchange rate regimes provide credible nominal anchors in the GCC countries, but combined with open capital accounts, they also entail limited monetary policy independence. At the same time, high dependence on hydrocarbon revenue has made the region vulnerable to oil price-driven liquidity swings. And the latter can affect monetary policy implementation, including by exacerbating credit and asset price cycles. This highlights the importance of frameworks aimed at forecasting liquidity and ensuring appropriate liquidity levels through the timely absorption or injection of liquidity by central banks. Over the past decade, liquidity management in the GCC countries has been based mainly on passive instruments. Abundant liquidity during times of high oil prices have placed liquidity absorption at the center of the central bank operations. Reserve requirements have helped absorb liquidity but have not been used very actively. Standing facilities, another key instrument, are more passive in nature, with the amount of liquidity absorbed or injected driven by banks rather than monetary authorities. Central banks bills or other instruments have also been used, but issuance has not systematically been based on market principles. In addition, these operations have been constrained by limited liquidity forecasting capability and the shallow nature of interbank and domestic debt markets.
Ms. Luisa Zanforlin
The paper analyzes the factors that contribute to the re-access of countries that emerge from a severe financial crisis to the international capital markets. It conjectures that these factors depend on a sovereign's commitment and ability to repay its foreign debt, signaled by sound macroeconomic policies, and the global liquidity environment. Using panel data for 49 countries over a 24-year period, the analysis uses a simple probit approach to show that, indeed, a sustainable debt profile and a sound external position, accompanied by a favorable global liquidity environment, are key factors in affecting the likelihood a sovereign reaccesses international capital markets.
Ms. Luisa Zanforlin

whether to resume lending. In contrast, the size of the impact of external soundness indicators was found to largest in increasing the likelihood of re-access of countries that did not restructure their obligations, which suggest that creditors, in such cases, focus on indicators of the ability-to-repay, which tend to be more of a short-term nature. To conclude, the estimation results support the theoretical prediction that, overall, sound domestic policies and external indicators, together with a favorable global liquidity environment are key considerations for