Adapting macro-prudential instruments to achieve monetary policy objectives
Victoria Cociug 1
1National Institute of Economic Research, Moldova
Article History
Received: 18 November 2020 Revised: 10 March 2021 Accepted: 12 March 2021 Available Online: 20 March 2021
Keywords: Monetary policy, macro-prudential policy, central bank, price stability
JEL classification: E42, E44, E52, E58, E61 G28
Citation: Cociug, V. (2021). Adapting macro-prudential instruments to achieve monetary policy objectives, Review of Socio-Economic Perspectives, Vol 6(1), 53-58.
Abstract
Monetary policy is used by governments to adjust financial market conditions to the needs of economic growth. But its application has certain limits, the biggest one being the interest rate limit on monetary policy instruments, which cannot be lesser than zero (although, at least in the euro area, this is already the case). Can monetary authorities use other instruments under these conditions? Currently, in the context of the COVID-19 crisis, most countries have injected huge sums of money into the financial market to maintain the consumption capacity of the population. Can macro-prudential policy instruments manage the existence of money supply to prevent it from entering the financial speculation market and inflate speculative bubbles / this article aims to analyze the behavior of macro-prudential policy, which can be used to achieve monetary policy objectives. The research is theoretical and contains reflections on the need for efficient use of macro-prudential policy instruments in optimizing monetary policy.
E-mail: v_cociug@mail.ru & ORCID: https://orcid.org/0000-0001-8114-4644
DOI: https://doi.org/10.19275/RSEP107
Article Type: Review Paper
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