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Para Politikasi, Parasal Buyuklukler ve Kuresel Mali Kriz Sonrasi Gelismeler

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  • K. Azim Ozdemir

Abstract

In this study we attempt to shed some light on the theoretical and empirical discussions regarding the role of monetary aggregates in monetary policy formulations. We also assess the developments in the aftermath of the global financial crisis and emphasize the role of monetary aggregates in this new economic environment. On the other hand, by analyzing monetary policies of the countries, where the monetary aggregates are given prominent roles in the decision-making processes, we investigate how monetary aggregates can be best utilized in the current design of the monetary policy in Turkey. Our main finding is that the velocity of circulation calculated by using M2Y is predictable. This finding is important because it allow us to calculate a reference growth rate for M2Y that is consistent with the inflation targets set by the Central Bank of Turkey. At the same time our findings suggest that the persistent deviations of the growth rate of M2Y from this reference rate signal the growing financial imbalances and inflationary risks in the economy.

Suggested Citation

  • K. Azim Ozdemir, 2009. "Para Politikasi, Parasal Buyuklukler ve Kuresel Mali Kriz Sonrasi Gelismeler," Central Bank Review, Research and Monetary Policy Department, Central Bank of the Republic of Turkey, vol. 9(2), pages 23-48.
  • Handle: RePEc:tcb:cebare:v:9:y:2009:i:2:p:23-48
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    Keywords

    Monetary aggregates; Financial crisis; Quantitative easing; Velocity of money;

    JEL classification:

    • E40 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - General
    • E51 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Money Supply; Credit; Money Multipliers
    • 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

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