2022 Update of the External Balance Assessment Methodology

Author/Editor:

Cian Allen ; Camila Casas ; Giovanni Ganelli ; Luciana Juvenal ; Daniel Leigh ; Pau Rabanal ; Cyril Rebillard ; Jair Rodriguez ; João Tovar Jalles

Publication Date:

March 3, 2023

Electronic Access:

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Disclaimer: IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.

Summary:

The assessment of external positions and exchange rates of member countries is a key mandate of the IMF. The External Balance Assessment (EBA) methodology has provided the framework for conducting external sector assessments by Fund staff since its introduction in 2012. This paper provides the latest version of the EBA methodology, updated in 2022 with additional refinements to the current account and real exchange rate regression models, as well as updated estimates for other components of the EBA methodology. The paper also includes an assessment of how estimated current account gaps based on EBA are associated with future external adjustment.

Series:

Working Paper No. 2023/047

Frequency:

regular

English

Publication Date:

March 3, 2023

ISBN/ISSN:

9798400234934/1018-5941

Stock No:

WPIEA2023047

Pages:

68

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