NBER International Finance and Macroeconomics Program Meeting

Why It Matters

Understanding when financial hedging alters invoicing choices matters for exchange-rate transmission, corporate risk management, and policy responses in dollar-dominated markets—affecting macroeconomic volatility and the efficacy of flexible exchange rates.

Summary

At the NBER International Finance and Macroeconomics meeting organizers opened with logistical announcements—shortening lunch and removing a coffee break to accommodate travel—and reiterated meeting norms and the NBER code of conduct. Attendees briefly introduced themselves from a wide range of universities and central banks. The first presentation was a job-market paper examining how financial hedging (foreign-currency debt and derivatives) interacts with firms’ choice of trade invoicing currency; the author argues that while standard theory often renders hedging irrelevant, there are identifiable conditions under which hedging materially influences invoicing decisions. The talk emphasizes dollar dominance in trade and debt in emerging markets and aims to formalize when hedging shifts real exchange-rate pass-through and firms’ pricing currency.