Coordination of Monetary and Fiscal Policies
March 1, 1998
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Summary
Recently, monetary authorities have increasingly focused on implementing policies to ensure price stability and strengthen central bank independence. Simultaneously, in the fiscal area, market development has allowed public debt managers to focus more on cost minimization. This “divorce” of monetary and debt management functions in no way lessens the need for effective coordination of monetary and fiscal policy if overall economic performance is to be optimized and maintained in the long term. This paper analyzes these issues based on a review of the relevant literature and of country experiences from an institutional and operational perspective.
Subject: Banking, Central bank credit, Central banks, Fiscal policy, Government debt management, Monetary base, Money, Public debt, Public financial management (PFM)
Keywords: budget deficit, Central bank credit, Coordination, debt management instrument, debt management procedure, debt service, exchange rate, Fiscal policy, fiscal policy adjustment, fiscal policy coordination, fiscal policy mix, Global, government cash balance, Government debt management, government securities, Monetary base, monetary management, Monetary policy, WP
Pages:
32
Volume:
1998
DOI:
Issue:
025
Series:
Working Paper No. 1998/025
Stock No:
WPIEA0251998
ISBN:
9781451844238
ISSN:
1018-5941
