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Mr. William E. Alexander, Mr. John Cady, and Mr. Jesus R Gonzalez-Garcia

suggested in this volume, one means is to revamp the GDDS to align it more closely with the SDDS to give more emphasis to data dissemination, the idea being that “supply creates its own demand.” With more information being disseminated, the market efficiency benefits may become more evident to policymakers, market participants, and the public at large. And the lower borrowing costs associated with participation in the SDDS and the GDDS may provide countries with an additional incentive. For the many countries seeking to participate but lacking the capacity to do so, the

Mr. William E. Alexander, Mr. John Cady, and Mr. Jesus R Gonzalez-Garcia

reserves template itself. Market Efficiency Benefits of the SDDS Indirect evidence illustrates that the second of the expected benefits, greater market efficiency, has been realized. For example, the risk premium on emerging market sovereign debt has declined substantially (the EMBIG spread). 13 There is also some evidence that contagion among emerging market countries has been reduced (there has been a secular reduction in the cross correlation among emerging market sovereign spreads). But, clearly, it is not possible to attribute these phenomena directly to

Mr. William E. Alexander, Mr. John Cady, and Mr. Jesus R Gonzalez-Garcia

reserves. Both the SDDS initiative at a general level and the reserves template were aimed at increasing transparency and promoting the efficient functioning of markets. In particular, for the reserves template, the G-10 working group considered that greater transparency on foreign currency liquidity would help to remove a source of financial instability (see BIS, 1998 , p. 1). The literature on the market efficiency benefits of standards and codes for data dissemination is relatively new, but empirical evidence indicating that emerging market subscribers to the

Mr. William E. Alexander, Mr. John Cady, and Mr. Jesus R Gonzalez-Garcia

Abstract

A key feature of the reform of the international financial architecture since the mid-1990s has been the development of international standards and codes.2 The data standards initiative, on which the IMF took the lead, broke new ground. The dissemination standards put in place as the centerpiece of this initiative continue to be among the most widely known of the international standards and codes.

Mr. William E. Alexander, Mr. John Cady, and Mr. Jesus R Gonzalez-Garcia

Abstract

“Nothing would help improve standards more than if countries that met higher standards were rewarded with lower borrowing costs”

Mr. William E. Alexander, Mr. John Cady, and Mr. Jesus R Gonzalez-Garcia

Abstract

The Data Dissemination Initiative was launched in the mid-1990s as part of a broader internationally-agreed-upon initiative to strengthen transparency and promote good governance practices by establishing standards and codes. Ten years later, the initiative is viewed as an integral part of the international financial architecture, and is considered to have improved the functioning of international financial markets and contributed to global financial stability. This volume reviews certain aspects of the development of and experience with the initiative over the past decade, and concludes by reflecting on potential challenges ahead and possible enhancements.

Mr. William E. Alexander, Mr. John Cady, and Mr. Jesus R Gonzalez-Garcia

Abstract

Although the name of the General Data Dissemination System (GDDS) infers that its central focus is dissemination, in its initial stages the GDDS emphasized the development of national systems in an explicit medium-term framework. Attention to data dissemination came only at a later stage. Indeed, participating countries are not required to make any formal commitments regarding data dissemination. The main premise underlying the GDDS is to give high priority to improvements in data quality, which may need to precede improvement in dissemination practice.

Mr. John Cady and Mr. Jesus R Gonzalez-Garcia

three other countries announcing their adoption of the new standard. Both the SDDS initiative at a general level and the Reserves Template were aimed at increasing transparency and promoting the efficient functioning of markets. In particular, for the Reserves Template, the G-10 Working Group considered that greater transparency on foreign currency liquidity would help to remove a source of financial instability (see BIS, 1998 , p. 1). The literature on the market efficiency benefits of standards and codes for data dissemination is relatively new, but empirical

Mr. Jesus R Gonzalez-Garcia and Mr. John Cady
The effects of the adoption of the IMF's International Reserves and Foreign Currency Liquidity Data Template on nominal exchange rate volatility are investigated for 48 countries. Estimation of panel data models indicates that nominal exchange rate volatility decreases following dissemination of reserves template data while the effects of indebtedness and reserve adequacy on volatility exhibit statistically significant changes.
Mr. Jesus R Gonzalez-Garcia and Mr. John Cady

Reserves Template, the G-10 Working Group considered that greater transparency on foreign currency liquidity would help to remove a source of financial instability. The literature on the market-efficiency benefits of standards and codes is limited, but empirical evidence indicating that emerging market subscribers to the SDDS face lower borrowing costs than nonsubscribers is accumulating. 4 To our knowledge, the exchange market efficiency effects of the SDDS or the Reserves Template data dissemination standards have yet to be examined. To fill this gap, this paper