Challenges to Central Banking from Globalized Financial Systems
Seminar Volumes, March 2, 2004
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Bibliographic details
- Authors: Andrea Schaechter, Piero Ugolini, Mark R. Stone
- Published: March 2, 2004
- Series: Seminar Volumes
- DOI: https://doi.org/10.5089/9781589062177.072
Overview and main findings
- Increasing global financial market integration is presenting new challenges to central banks as they seek to attain low inflation and financial stability.
- The volume is based on a conference hosted by the IMF in September 2002.
- It examines key issues such as:
- the choice of nominal anchor for countries susceptible to shifts in capital flows,
- what can be done to prevent and deal decisively with financial crises,
- how central bankers should think about the difficult choices when monetary objectives and financial stability objectives come into conflict.
Topics examined (substantive themes)
- Choice of nominal anchor for countries susceptible to shifts in capital flows.
- Measures to prevent financial crises.
- Strategies to deal decisively with financial crises once they occur.
- Trade-offs and decision frameworks when monetary policy objectives (e.g., price stability) and financial stability objectives conflict.
Policy implications and considerations
- Central banks operating in increasingly integrated global financial markets must reassess monetary frameworks and nominal anchors in light of cross-border capital flow volatility.
- Preventive policies and decisive crisis-management tools are emphasized as critical to preserving financial stability.
- Central bankers need to explicitly weigh and manage conflicts between inflation-targeting/price-stability goals and financial-stability mandates.
Subjects and keywords
- Subject: Banking, Currencies, Dollarization, Financial sector policy and analysis, Financial sector stability, Inflation, Inflation targeting, Monetary policy, Money, Prices
- Keywords: Africa, Caribbean, Central America, central bank, central bank financing, Currencies, Dollarization, emerging market country, Europe, Financial sector stability, foreign currency, Global, Inflation, Inflation targeting, ITL country, market, monetary policy, monetary policy approach, monetary policy strategy, price stability goal, SEM, South America
Source: Challenges to Central Banking from Globalized Financial Systems (IMF page overview).