Monetary Policy and Central Banking in the Wake of the World Financial Crisis
AbstractThe article identifies causes of the world financial crisis and its impact on monetary policy and central banking. Under the pressure of crisis, the standard monetary policy of previous periods shifted to unconventional instruments of “quantitative easing”. This change represents move away from technical monetary policy towards a more activist approach. Will this shift be only temporary and monetary policy will return to traditional standards as the crisis subsides? Or will its impact be of a more permanent character? The article examines the applied unconventional monetary policy measures, their consequences and risk involved. For the past decades central banking has been dominated by consensus which holds the view that central bankers´ prime task is to keep inflation low and stable. Learning the lesson from the current crisis the article discusses the arguments whether monetary policy should be and could be more oriented to the broader issues of financial stability, not just price stability.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoArticle provided by University of Finance and Administration in its journal ACTA VSFS.
Volume (Year): 3 (2009)
Issue (Month): 2 ()
monetary policy; central banking; financial crisis; price stability; global imbalances; savings glut; liquidity glut; interest rates; quantitative easing; unconventional instruments balance sheets; asset market bubble; inflation expectations;
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Frederic S. Mishkin, 2007.
"Will Monetary Policy Become More of a Science?,"
NBER Working Papers
13566, National Bureau of Economic Research, Inc.
- Claudio Borio & William R. White, 2003.
"Whither monetary and financial stability : the implications of evolving policy regimes,"
Proceedings - Economic Policy Symposium - Jackson Hole,
Federal Reserve Bank of Kansas City, pages 131-211.
- William R. White & Claudio E. V. Borio, 2004. "Whither monetary and financial stability? the implications of evolving policy regimes," BIS Working Papers 147, Bank for International Settlements.
- William R. White, 2006. "Is price stability enough?," BIS Working Papers 205, Bank for International Settlements.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Helena Hakenova).
If references are entirely missing, you can add them using this form.