TY  - GEN
AU  - García-Cicco, Javier
AU  - Kawamura, Enrique
TI  - Effects of Foreign-Currency Debt on Non-Financial Latin American Firms: Evidence from the 2000s
PY  - 2016
Y1  - 2016/12/12
DO  - 10.18235/0009316
AB  - This paper empirically tests the effects of foreign currency debt on economic performance and investment behavior in non-financial firms in six Latin America and Caribbean countries. It is found find that domestic-currency depreciations may surprisingly increase the exchange-rate induced profits of particularly highly foreign currency-indebted firms (especially those that are foreign owned and others with foreign links). Such depreciations have only a mild correlation with gross profits. Foreign-currency debt seems to have ambiguous effects on fixed investment purchases behavior, possibly attributable to non-financial firms' behavior as financial intermediaries. This effect tends to vanish when financial derivatives are considered.
UR  - https://doi.org/10.18235/0009316
ER  -