scholarly journals Monetáris politikai kihívások a szubszaharai régióban

2019 ◽  
Vol 13 (1-2.) ◽  
pp. 57-74
Author(s):  
Szabolcs Pásztor
Keyword(s):  
Monetary Policy ◽  
Natural Resources ◽  
Financial Stability ◽  
Central Banks ◽  
Fiscal Policies ◽  
Appropriate Treatment ◽  
Short Synthesis ◽  
Sub Saharan ◽  
Adequate Management

The monetary policy of the Sub-Saharan countries is a lesser-known field for those Hungarian readers who are interested in Africa. In the last few decades several fundamental changes took place so a short synthesis is badly needed to better understand this issue. Apart from the fact that this study tries to shed light on the monetary policy challenges of different periods, it also places much emphasis on the contemporary issues in central banking.After the turn of the new millenium the central banks have been struggling with unpredictable fiscal policies, the appropriate treatment of the revenues of the natural resources, not to mention the inflow of foreign aid. It is also highly important to monitor the frequency of the supply shocks and the efficiency of the monetary transmission mechanism. After shedding more light on these issues, the paper tries to focus on the role of the exchange rates, the room for manoeuvre of the central banks in the financial stability and the adequate management of the revenues stemming from the export of natural resources.

scholarly journals A new paradigm of modern central banking

2013 ◽  
Vol 2 (2) ◽  
pp. 75-78
Author(s):  
Aleksandra Szunke
Keyword(s):  
Monetary Policy ◽  
Financial Stability ◽  
Global Financial Crisis ◽  
Central Banks ◽  
Central Banking ◽  
First Century ◽  
Financial Instability ◽  
New Paradigm ◽  
The Global Financial Crisis

The changes in the modern monetary policy, which took place at the beginning of the twenty-first century, in response to the global financial crisis led to the transformation of the place and the role of central banks. The strategic aim of the central monetary institutions has become preventing financial instability. So far, central banks have defined financial stability as a public good, which took care independently of other monetary purposes (Pyka, 2010). Unconventional monetary policy resulted in changes the global central banking. The aim of the study is to identify a new paradigm of the role and place of the central bank in the financial system and its new responsibilities, aimed at countering financial instability.

scholarly journals The Role of Capital Regulation and Risk-Taking by Banks in Monetary Policy

2014 ◽  
Vol 5 (1) ◽  
pp. 7-26
Author(s):  
Małgorzata Olszak
Keyword(s):  
Monetary Policy ◽  
Risk Taking ◽  
Financial Stability ◽  
Central Banks ◽  
Output Growth ◽  
Capital Regulation ◽  
Bank Capital ◽  
Endogenous Factors ◽  
Credit Cycle

The credit boom prevailing in the period preceding the last financial crisis was prolonged and associated with neither particularly strong output growth nor rising inflation in economies in which it occurred. This type of credit cycle and financial cycle is hard to reconcile with existing economic theory applied in monetary policy. In this paper we point out to endogenous factors behind this phenomenon. We aim to identify what is the role of bank capital regulation and bank risktaking in the transmission mechanism of monetary policy. The transmission of monetary policy impulses through capital channel is a diversified process, and depends on bank specific, background macroeconomics’s specific and other factors. Bank capital standards affect the banks’ perception, management and pricing of risks. In this area, monetary policy is also of great importance, with prominent role of the so called risk-taking channel in which central banks actions have an impact on bank risk attitudes. Consequently monetary policy is not fully neutral from a financial stability perspective. Stable level of inflation does not guarantee the stability of financial system. Therefore central banks in their conduct of monetary policy should constrain the build-up of financial imbalances.

scholarly journals Securitization of (bad) loans to Italian SMES: The role of the public guarantee

2021 ◽  
Vol 16 (4) ◽  
pp. 193-208
Author(s):  
Lucilla Bittucci ◽  
Stefano Marzioni ◽  
Pina Murè ◽  
Marco Spallone
Keyword(s):  
Financial Stability ◽  
Positive Impact ◽  
Central Banks ◽  
General Purpose ◽  
Recent Past ◽  
Balance Sheets ◽  
Access To Credit ◽  
The Public ◽  
Main Factors

This study investigates the main factors driving the evolution of the securitization of loans to Italian small and medium-sized enterprises (SMEs). The value of securitization increased in last two years, even though it has not been used as collateral for central banks. The disposal of non-performing loans (NPLs) may have been rather triggered by increasing attention of the international institutions to such an issue, within the general purpose of financial stability. The purpose of this paper is to interpret such a phenomenon focusing on Italian banks and restricting the analysis to the case of securitizations backed with loans to small and medium-sized enterprises (SMEs). The interesting result that emerges, supported by econometrically tested empirical evidence, is that given the orientation of international financial institutions, such as the ECB and the EBA, and reacting to incentives coming from the fiscal policy authorities for the public guarantee of loans, banks have been using securitization to reduce the burden on their bad balance sheets due to (NPLs). It was found that the public guarantee had a positive impact on SME securitization, whereas securitization in other sectors has not been affected significantly. Such evidence suggests that, in the absence of a public guarantee, the financial stability target would have been at risk, and the effectiveness of collateral-based policies in the recent past must be improved to enhance access to credit for SMEs.

scholarly journals Regular Econometric Model of Taylor for Albania

2016 ◽  
Vol 5 (1) ◽  
pp. 123
Author(s):  
Ergys Misha
Keyword(s):  
Economic Growth ◽  
Monetary Policy ◽  
Interest Rates ◽  
Financial Stability ◽  
Inflation Targeting ◽  
Inflation Rate ◽  
Stock Exchange ◽  
Central Banks ◽  
Financial Assets

The Taylor’s Rule Central Banks is applying widely today from Central Banks for design the monetary policy and for determination of interest rates. The purpose of this paper is to assess monetary policy rule in Albania, in view of an inflation targeting regime. In the first version of the Model, the Taylor’s Rule assumes that base interest rate of the monetary policy varies depending on the change of (1) the inflation rate and (2) economic growth (Output Gap).Through this paper it is proposed changing the objective of the Bank of Albania by adding a new objective, that of "financial stability", along with the “price stability”. This means that it is necessary to reassess the Taylor’s Rule by modifying it with incorporation of indicators of financial stability. In the case of Albania, we consider that there is no regular market of financial assets in the absence of the Stock Exchange. For this reason, we will rely on the credit developmet - as a way to measure the financial cycle in the economy. In this case, the base rate of monetary policy will be changed throught: (1) Targeting Inflation Rate, (2) Nominal Targeting of Economic Growth, and (3) Targeting the Gap of the Ratio Credit/GDP (mitigating the boom cycle, if the gap is positive, and the contractiocycle if the gap is negative).The research data show that, it is necessary that the Bank of Albania should also include in its objective maintaining the financial stability. In this way, the contribution expected from the inclusion of credit gap indicators in Taylor’s Rule, will be higher and sustainable in time.

scholarly journals CENTRAL BANK DIGITAL CURRENCY: ECONOMIC AND LEGAL CHARACTERISTICS

2019 ◽  
pp. 94-100
Author(s):  
T.S. Hudima ◽  
V.A. Ustymenko
Keyword(s):  
Monetary Policy ◽  
Central Bank ◽  
Financial Stability ◽  
Banking System ◽  
Legal Framework ◽  
Central Banks ◽  
Digital Currency ◽  
Business Entities ◽  
The Right ◽  
Article 5

The article is devoted to identifying the peculiarities of the central bank digital currency (CBDC), explaining their impact on the monetary policy of the state, and identifying the prospects for the transformation of domestic banking legislation in connection with the implementation of the CBDC. It is noted that the scope of competence of the Central Bank and the legal basis for the issuance of the CBDC will depend on the economic and legal features of the digital currency, the degree of its impact on the monetary policy, the financial stability of the country’s economy and so on. In the process of forming the appropriate legal field and defining the conceptual apparatus in the sphere of emission and circulation of the CBDC, the peculiarities of the use of the latter in economic transactions and the specific functions not inherent in ordinary means of payment should be taken. СBDC initiatives will help: 1) progressively narrow the banking system at the level of the Central Banks (such as the Chicago Plan) by allowing individuals and businesses to deposit directly into the accounts of the Central Banks; 2) increasing confidence of economic entities and individuals in the financial system; 3) strengthening the financial stability of the economy (both domestically and globally). Granting business entities or individuals the right to store digital money directly with the Central Bank can give rise to two main directions of influence on monetary policy: first, to strengthen its transmission mechanism; secondly, lead to banks being disrupted. This may lead to some legal issues regarding (1) the NBU’s area of competence; (2) the constitutional foundations of the legal economic order (Article 5 of the ECU). In particular, it cannot be ruled out that centralization of the production, servicing, and management of the СBDC turnover may violate the principles of competition in business activities, prevent abuse of monopoly position in the market, etc. Keywords: monetary policy, central bank digital currency, financial stability, competence, legal framework, economic operations, issue.

scholarly journals Negative Interest Rate Risk. Atavism or Normalization of Central Banks’ Monetary Policy

2019 ◽  
Vol 3 (342) ◽  
pp. 89-116
Author(s):  
Irena Pyka ◽  
Aleksandra Nocoń
Keyword(s):  
Monetary Policy ◽  
Interest Rate ◽  
Interest Rates ◽  
Financial Stability ◽  
Global Financial Crisis ◽  
Central Banks ◽  
Interest Rate Risk ◽  
Interest Rate Policy ◽  
Rate Policy ◽  
Negative Interest Rate Policy

In the face of the global financial crisis, central banks have used unconventional monetary policy instruments. Firstly, they implemented the interest rate policy, lowering base interest rates to a very low (almost zero) level. However, in the following years they did not undertake normalizing activities. The macroeconomic environment required further initiatives. For the first time in history, central banks have adopted Negative Interest Rate Policy (NIRP). The main aim of the study is to explore the risk accompanying the negative interest rate policy, aiming at identifying channels and consequences of its impact on the economy. The study verifies the research hypothesis stating that the risk of negative interest rates, so far unrecognized in Theory of Interest Rate, is a consequence of low effectiveness of monetary policy normalization and may adopt systemic nature, by influencing – through different channels – the financial stability and growth dynamics of the modern world economy.

Exiting from Fragility in Sub-Saharan Africa: The Role of Fiscal Policies and Fiscal Institutions

2015 ◽  
Author(s):  
Corinne Deléchat ◽  
Ejona Fuli ◽  
Dafina Mulaj ◽  
Gustavo Ramirez ◽  
Rui Xu
Keyword(s):  
Sub Saharan Africa ◽  
Fiscal Policies ◽  
Fiscal Institutions ◽  
Sub Saharan

Money, Central Banks, and Low Financial Development Countries

2021 ◽  
pp. 1-44
Author(s):  
Juan Antonio Morales ◽  
Paul Reding
Keyword(s):  
Monetary Policy ◽  
Financial Development ◽  
Central Banks ◽  
Historical Background ◽  
Special Role ◽  
Design And Implementation ◽  
Financial Depth ◽  
Per Capita ◽  
Selection Of

This chapter gives a general overview of the nuts and bolts of monetary policy and presents the low financial development countries that are the focus of this book. It discusses, with some historical background, the special role of money in the financial system, the functions of central banks, and the mandates society has entrusted them with. It also shows how monetary policy is structured within a specific framework of targets and instruments that guides the central bank’s interventions. Finally, it presents the main features that characterize the selection of developing countries that the book aims to address and that raise specific challenges for the design and implementation of their monetary policy: low per capita income, low financial depth, and weak integration with international financial markets.

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