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Sovereign Defaults on Local Currency Debt by acalju is a document available to read on EtoBox.

What is Sovereign Defaults on Local Currency Debt about?

The document discusses why sovereign governments may choose to default on domestic, local currency debt even though they have the ability to print money. It first explains how printing money through monetary financing or debt monetization can theoretically reduce debt levels by generating inflation and lowering real debt values. However, it notes there are limits to this approach, as higher inflation may not significantly impact debt if it is anticipated and debt is short-term. Additionally, inflation can h

Author

acalju

Language

EN