Correlation between the use of derivatives products and the implementation of the monetary policy
In a developing and fluctuant world, derivatives help the investors to avoid risks and moreover to assume them when it is necesary. The trade of the derivatives contributes to the growth of liquidity of the assets’ market. For the banks, which traditionally avoid risks, this fact combined with low costs for communication and trading, lead to some potential risky investments. The materialization of monetary policy is based on the idea that the needs of the real economy are expressed through the bankimg system, and the changes of the monetary policy influence the evolution of the economy. In this way, the monetary authority has to promote a proper policy, which can lead to the achievement of its main objective – price stability. The use of derivatives made the central bank mission more difficult. The authorities have a difficult task in order to establish new methods, more powerful, for a better implementaton of the monetary policy. In a dynamic environment the equilibrium is not permanent; this is the reason why the central bank and the financial markets participants must prevent first, and then avoid the possible repairs.
Volume (Year): 1 (2008)
Issue (Month): 7 (May)
|Contact details of provider:|| Postal: |
Phone: 004 0251 411317
Fax: 004 0251 411317
Web page: http://feaa.ucv.ro/
More information through EDIRC
When requesting a correction, please mention this item's handle: RePEc:aio:fpvfcf:v:1:y:2008:i:7:p:203-210. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Alina Manta)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.