Public Information Notice: IMF Executive Board Discussed Staff Paper on Monetary Policy Implementation
February 07, 2005

Monetary Policy Implementation at Different Stages of Market Development
Country Cases and Appendices -- Supplementary Information
October 28, 2004

Monetary Policy Implementation at Different Stages of Market Development 1

Prepared by Staff of the Monetary and Financial Systems Department

Approved by Stefan Ingves

October 26, 2004

Use the free Adobe Acrobat Reader to view the pdf file (138kb)

This paper was discussed in a Board seminar.


Glossary of Monetary Instruments
Executive Summary
I.   Overview
II.   Country Experiences
  A.   Macroeconomic Conditions
  B.   Market Participation Limitations
  C.   Institutional Shortcomings
III.   Implications for Policy Design and Coordination
  A.   Selecting a Monetary Framework: Prices versus Quantities
  B.   Choice of Monetary Instruments
IV.   Agenda for Actions to Enhance Monetary Policy Effectiveness
  A.   Curtailing Fiscal Dominance
  B.   Dealing with Structural Liquidity Surplus
  C.   Establishing Efficient Money Markets
  D.   Strengthening Financial Market Infrastructure
V.   Sequencing of Reforms
VI.   Implications for Fund Operations
1.   Use of Monetary Instruments in a Sample of Countries
2.   Technical Assistance in Monetary Policy Implementation, 1999-2004
3.   Stylized Structure of Central Bank Interest Rates
4.   Functions of Monetary Instruments at Stage Two and Three
1.   Monetary Policy Implementation at Different Stages of Market Development
1.   The Conduct of Monetary Policy 
2.   Country Examples of Fiscal Dominance
3.   Country Examples of Structural Liquidity Surplus
4.   Country Examples of Market Participation and Institutional Limitations
5.   Liquidity Forecasting Frameworks
6.   Initial Conditions for Inflation Targeting
7.   Successful Experiences in Small Countries
8.   Typology of Money Market Operations
9.   Fostering Fiscal Discipline in the Eastern Caribbean Currency Union
10.   Measures to Limit the Distortionary Effects of Rules-Based Instruments
11.   Monetary Instruments for Small Countries
12.   Synergies Between Fund Operations: Selected Country Experiences
Monetary Policy Implementation in Small Countries

1 Prepared by a Monetary and Financial Systems Department staff team led by Bernard J. Laurens.