 Okay. Thank you very much for the price. It's a huge honour. Thank you very much, Sylvie, for those really nice words. So I'd like to present you work with Michael Magli or Domina Currency and the impact of Monetary Policy. The question of paper is, can Monetary Policy help stabilize the economy when bank occurrences are used in international trade? The question of civilization is a brand new one in macroeconomics, but in this paper we want to address it from the perspective of countries often developing an emerging economies that export commodities or goods and services that are traded in fairly competitive export markets. And completely, we focus on economies that use the US dollar as the main currency of invoice. The goal is to understand how the dollar dominance affects the transmission of Monetary Policy. So let me start with the motivation. As highlighted by Linda Gumber and Gita Gopidaf, the US dollar is the main currency of invoice in international trade transactions. Even though international trade with the United States is only a little over 10% of global trade, nearly 50% of international trade is invoice in dollars. And this is illustrated in this art here. The light blue bar shows the countries' exports to the United States as a share of its total exports. And the dark blue bar shows the value of exports invoiced in dollars as a share of the country's total exports. So for example, France here, the share of exports to the US is below 8%, when the share of French exports invoiced in US dollars was around 20%. For less advanced economies like Argentina or Brazil, the share of exports invoiced in dollars is nearly 100%, even though their export shares to the US are well below 20%. Now the dollar dominance has led to a new paradigm that is shifting policy views. The inference that has been drawn is that an exchange rate depreciation by a country invoicing in dollars does not provide a boost to exports. There's no expenditure switching towards a country's exports when the currency depreciates. This, the argument goes, means that flexible exchange rates have a more limited role as automatic stabilizers and hence that the exchange rate channel of monetary policy is weaker or impaired. An implication for policy, as you can see, is called from the IMF, is that other civilisation tools should be deployed because the exchange rate changes have muted effects on the trade balance, given the limited response of export volumes. Now, why is this? There are two key assumptions underlying the thinking. The first is that exporters have monopoly power. And the second is that prices are sticky, and in the dominant currency framework, they are sticky in dollars. Now, if prices are sticky in dollars and exchange rate depreciation by a non-US country does not change the export price in dollar. Hence, in that framework, there's no expenditure switching towards that country's products and no increase in exports or demand for exports or quantities demanded. So, I'd like to argue here that these assumptions are much less likely to hold outside the US. Many developing and emerging country producers tend to be price takers. They export commodities or commodity-like products with little, if any, market power. And when the prices of those products are often quoted in dollars, those prices are flexible. So, let me go through these points in detail. This graph illustrates the logic underlying the dominant currency pipeline. This is an exporter with monopoly power facing a downward sloping demand curve. The monopolist says the price was to maximize profits, and that price is sticky in dollars. A depreciation of the currency lowers the cost of production expressed in dollars. Think here about labor costs, real estates, or other non-tradable inputs entering the cost base of the producer. These costs tend to be set in pesos or domestic currency. So, a depreciation shifts the cost per downwards when expressed in dollars. The profitability of this exporter increases with a depreciation, but her price does not change because it is assumed to be sticky. Hence, the quantity demanded doesn't change, and as a consequence, the depreciation does not boost the monopolist's exports. What the standard New Keynesian model misses is that a large share of emerging and developing economies are commodity exporters. Commodity producers face elastic demands, as illustrated in this graph. Their prices are fully flexible, yet they also do not move with the depreciation of the currency, the domestic currency. Why? Because the producer is a price taker, and prices are determined in global markets. However, in this case, export quantities increase with a depreciation. Again, a depreciation of their currency reduces the input costs, as before, expressed in dollars. And the only constraint for this producer is capacity, not demand. The literature has interpreted the lack of pass-through from depreciation to export prices as evidence of sticky prices in dollars. But as illustrated here, and this is one of the main points in the paper, there is also zero pass-through to export prices, if the producer operates in a very competitive market and her prices are fully flexible, as in this example. Lack of pass-through is not evidence in favor of sticky prices, or in favor of the dominant currency paradigm. The dollar prices of commodities do not change with the depreciation, but that is not because of sticky price frictions. On the contrary, limited pass-through comes from a competitive global market. Now, the exception doesn't stop at strict commodities. Many producers in developing, emerging, and even advanced economies outside the US are closer to commodity exporters, in that they face quite elastic demands. This is illustrated in this chart. Again, a depreciation lowers dollar costs of production. The pass-through to export prices might be small, but with very elastic demands, quantities move a lot. How much increase is largely determined by capacity? Here, capital in a stylized way by the upward sloping cost curve, marginal cost curve. So to recap, with monopolists and CQB, dollar prices and depreciation by a non-US country does not affect export prices or export quantities. Monetary policy and exchange rate movements in that setting have no impact on exports. With commodity or commodity-like producers and flexible prices and exchange rate depreciation also does not affect dollar export prices much, but it increases export quantities. So let me now show you how those intuitions mount in the fully fledged model. We use a similar small-open economy-neucation framework to the benchmark dominant currency paradigm set out by Gopinathan authors. And indeed, we show that minimal deviations from that framework highlighted here in red can be hugely consequential for policy. Gopinathan authors assume the same degree of substitutability across goods and across varieties within a good, whether produced abroad or domestically. So, for example, the crude oil produced in Mexico is different from the crude oil produced in Argentina, and the elasticity of substitution is the same. Between those two is the same as between oil and, say, apples or educational services. Now, we adopted more general formulation which allows us to have low substitution across goods or sectors, broadly defined, but higher elasticity of substitutions across different varieties of the same goods. While we also have sticky wages, differently from the dominant currency model, we allow prices to be flexible rather than sticky in dollars. This is in line with the idea that with elastic demand, stickiness becomes very costly. So, these are our maximizing households. They choose leisure and consumption of a bundle of goods, given by C8. Sigma is elasticity of substitution across different goods or sectors G. In each good category, consumption consists of different varieties, omega produced either at home or abroad. Each country produces a set of varieties of each good. And consumption of good G in country A, the whole country, aggregates over the different varieties and the elasticity of substitution across those varieties is given by EKG. Production combines workers and a composite of intermediate goods, eggs, which are aggregated, aggregate the same varieties as in the consumption case. So that simplifies the aggregation. We close the model with a simple inflation targeting rule. So let me now turn to the simulations to compare to the benchmark. Again, we calibrate the model closely following opinion and authors, except we're highlighted in red. For the elasticity of substitution across goods, we use a value of two like they. And we compare to a benchmark sticky dollar price model, which uses a value of two also for the elasticity across varieties consistent with the idea that firms are monopolists for their own variety. But in our flexible price model, our homogeneous varieties have a higher elasticity of substitution of 17. In this case, as in broader wine sites were for homogeneous goods. And these are the impulse responses that we obtain. They show that the intuition from the earlier charts follows through to the full model. They show the effects of a monetary policy expansion, comparing the sticky dollar price monopolist in bloom to our flexible price homogeneous goods in red. As an additional comparison, the black dashed lines show a variant where goods are sticky in the producer currency as in the flaming. In all cases, the policy shock leads to a sharp depreciation relative to the dollar. So here is a rise in the exchange rate. This increases import prices in peso and inflation. And our focus, as I was saying, is on exports and in both the DCP, the currency paradigm and in ours, export prices in dollars move only a small amount. This contrasts with the standard model flaming assumption of producer prices. The dashed lines here where the depreciation mechanically lowers export prices expressed in dollars or in foreign currencies. As in the stylized charts earlier, the reason for limited pass through the first across these two models in the dominant currency framework prices are seeking dollars by assumption. And with low elasticity, the result is that export volumes here in blue are little changed. In contrast, in our flexible price model with more homogeneous goods, the elasticity is much higher. So even a small fall in dollar prices leads to a large increase in exports and health output. This slide summarizes those responses quantitatively showing the average effects for the first year after the fall. Despite similar depreciations in the first line, a limited pass through coefficients for the price of exports. In our case, export volumes rise over 10 times as much as in the dominant currency paradigm. In reality, of course, some exporters are just prices more frequently than others, some face more or less elastic demand. So the key impact question is which conditions are faced by these dollar pricing exporters. So let me now turn to the MPL evidence. This table summarizes the key differences between the two models. The dominant currency literature assumes exporters have high market power and face fairly inelastic demands. Our model allows for more competition across countries by a high elasticity of demand for individual varieties. The dominant currency literature assumes sticky prices, whereas the assumed prices are adjusted with high frequency flexibly. Both models predict that pass through from exchange rates to export prices in dollars is low. But the dominant currency paradigm predicts little export quantity response, whereas our model predicts export response strongly. So we'll now go through these assumptions, these two key assumptions and the two implications in turn, and argue that our model is more suitable to represent developing and emerging economies and to think about optimal policies or compromises in those countries. So the first factor I want to highlight is that those economies, in those economies, a large fraction of their exports are homogeneous goods as illustrated here. More than 60% of exports of developing countries and 50% of emerging markets are homogeneous goods. And this is much higher for some countries, Ghana and Chile, for example, their shares are over 80%. The second factor is that homogeneous goods prices are highly flexible. For example, this chart shows wrong movements for various commodity prices. They're anything by sticky. And this is confirmed by many papers that examine price stickiness by product category, including the work of Amy and Jones, with a copy basis here. We show very short durations for unprocessed foods and also proof materials in the paper. So in this slide here. Gopinath and Rigobon aggregating across homogeneous goods find that they are adjusted far more frequently than differentiated goods. They're, I would say, every one to three months versus 14 months in differentiated goods. So these two facts clash with the two critical assumptions of monopoly power and price stickiness. Now let me turn to the implications. Let's start from premise that exchange rate changes have small effects on export prices in U.S. dollars. The dominant part is literature interprets as evidence of price stickiness. But as I hope I make clear, it's borders of highly competitive products facing high demand elasticity and exchange rate depreciation does not change export prices either. This lack of pass through does not imply stickiness. On the contrary, those prices are perfectly flexible. The lack of pass through into prices cannot distinguish the two models. So this is not a helpful test for the theory. The ideal test to the model implications lies in the behavior of quantities. And the key challenge is identification related to what Silvio was mentioning before. Depreciations do not happen randomly. An ideal test would analyze, for example, the effect of monetary policy shocks which move exchange rates, but should be orthogonal to other determinants of export volumes. Domestic monetary policy shocks can be thought of as external instruments for the exchange rate. I'm running out of time, but as an example, this chart here taking from a study of Perez Forero for Latin American countries, identifies domestic monetary policy shocks with sign-reference, with the tightening assumed to cause an exchange rate depreciation on impact. He finds a very strong response of output volumes. This is a tightening, so it's the flip side of what I just described. So how it falls significantly in all countries following the monetary policy tightening and the appreciation. He doesn't have exports, so we are in the process of producing similar results focusing specifically on the response of exports in this economy. So let me now turn to the conclusions. The dominant currency paradigm has advanced the frontier on many directions, but the standard framework has adhered to two features that are not realistic for most developing and emerging economies. Monopoly power and global markets and sticky prices. Changing those assumptions leads to very different conclusions and policy implications. Specifically, counter cyclical monetary policy and exchange rates can help stabilize economies via trade channels, even with dollar dominance. This is relevant for developing and emerging countries seeking to stabilize their economies, particularly those most constrained in their fiscal capacity as they emerge from the COVID crisis. Thank you. Thank you very much, Sylvanna. It was great and this kind of reflection is very useful as well for our vision of the international role of the euro.