Central Banking in Making during the Post-crisis World and the Policy-Mix of the Central Bank of the Republic of Turkey
AbstractAfter the global crisis, one of the most important lessons learned for the Central Banks has appeared to be the vital importance of financial stability along with the price stability. Hence, finding solutions to how to incorporate the financial stability objective in the implementation of the monetary policy without diluting the price-stability objective has started to be heavily discussed by the academics and policy makers. Accordingly, it has started to be debated that using only short-term interest rates as the main policy tool may not be enough to maintain the price stability and the financial stability at the same time. Interest rates that provide price stability and financial stability can be different and this necessitates the central banks to use multiple policy tools. In view of this, the Central Bank of the Republic of Turkey adopted a new monetary policy framework called the new policy mix in which multiple tools are employed to achieve multiple objectives. In this framework, required reserves ratios, weekly repo rates, interest rate corridor, funding strategy and other macro prudential tools are jointly used as complementary tools for the credit, interest rate and liquidity policies to achieve the price and the financial stability objectives concurrently. This new monetary policy adopted in Turkey also provides an interesting case study to assess how a country came up with novel policies to account for its country specific characteristics.
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 InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 46612.
Date of creation: Apr 2013
Date of revision:
Central banking; Policy-mix; Global financial crisis; Financial Stability;
Other versions of this item:
- Yasin Akçelik & Ahmet Faruk Aysan & Arif Oduncu, 2013. "Central Banking in Making during the Post-Crisis World and the Policy-Mix of the Central Bank of the Republic of Turkey," Journal of Central Banking Theory and Practice, Central bank of Montenegro, Central bank of Montenegro, vol. 2(2), pages 5-18.
- E44 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Financial Markets and the Macroeconomy
- E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
- E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-05-05 (All new papers)
- NEP-ARA-2013-05-05 (MENA - Middle East & North Africa)
- NEP-CBA-2013-05-05 (Central Banking)
- NEP-MAC-2013-05-05 (Macroeconomics)
- NEP-MON-2013-05-05 (Monetary Economics)
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.:
- Yasin Akcelik & Ergun Ermisoglu & Arif Oduncu & Temel Taskin, 2012. "Ek Parasal Sikilastirma’nin Doviz Kurlari Uzerindeki Etkisi," CBT Research Notes in Economics, Research and Monetary Policy Department, Central Bank of the Republic of Turkey 1230, Research and Monetary Policy Department, Central Bank of the Republic of Turkey.
- Erdem Basci & Hakan Kara, 2011. "Financial Stability and Monetary Policy," Working Papers 1108, Research and Monetary Policy Department, Central Bank of the Republic of Turkey.
- Andrew K. Rose, 2006.
"A Stable International Monetary System Emerges: Inflation Targeting is Bretton Woods, Reversed,"
NBER Working Papers
12711, National Bureau of Economic Research, Inc.
- Rose, Andrew K., 2007. "A stable international monetary system emerges: Inflation targeting is Bretton Woods, reversed," Journal of International Money and Finance, Elsevier, Elsevier, vol. 26(5), pages 663-681, September.
- Claudio Borio, 2011. "Central banking post-crisis: What compass for uncharted waters?," BIS Working Papers 353, Bank for International Settlements.
- Yasin Akcelik & Erdem Basci & Ergun Ermisoglu & Arif Oduncu, 2013. "The Turkish Approach to Capital Flow Volatility," Working Papers 1306, Research and Monetary Policy Department, Central Bank of the Republic of Turkey.
- Adrian, Tobias & Song Shin, Hyun, 2010.
"Financial Intermediaries and Monetary Economics,"
Handbook of Monetary Economics, Elsevier,
in: Benjamin M. Friedman & Michael Woodford (ed.), Handbook of Monetary Economics, edition 1, volume 3, chapter 12, pages 601-650
- Paul Bloxham & Christopher Kent & Michael Robson, 2011.
"Asset Prices, Credit Growth, Monetary and Other Policies: An Australian Case Study,"
NBER Working Papers
16845, National Bureau of Economic Research, Inc.
- Paul Bloxham & Christopher Kent & Michael Robson, 2010. "Asset Prices, Credit Growth, Monetary and Other Policies: An Australian Case Study," RBA Research Discussion Papers, Reserve Bank of Australia rdp2010-06, Reserve Bank of Australia.
- Erdem Başçı & Hakan Kara, 2011. "Finansal istikrar ve para politikası," Iktisat Isletme ve Finans, Bilgesel Yayincilik, Bilgesel Yayincilik, vol. 26(302), pages 9-25.
- Arif Oduncu & Yasin Akcelik & Ergun Ermisoglu, 2013. "Reserve Options Mechanism and FX Volatility," Working Papers 1303, Research and Monetary Policy Department, Central Bank of the Republic of Turkey.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Ekkehart Schlicht).
If references are entirely missing, you can add them using this form.