Most of these loans are interest-free and it was done in an attempt to prevent another financial crisis of the same magnitude. It flooded the markets with euros and hoped that this will ease out the problem to some extent (Kulish, 2012)
ECB wants Greece to implement its agreed restructuring plan because it does not want to intervene again until the governments take steps. The ECB does not want the banks and governments to get addicted to the funding it receives and wants them to do their role in the debt crisis as well (Buell, 2012)
Mr. Draghi, the President of the ECB, believes that these measures are essential to accelerate the economies and said that a weaker economy could bring down the inflation rates (Blackstone and Gauthier-Villars, 2011)
Why do some governments deny more freedom to the Central Bank? The governments hesitate to give complete autonomy because the activities of the central bank creates volatility in the market-especially the financial market and this affects all markets and inflation targeting thus is based on the monetary policy of the central bank. (Bernanke; Laubach; Mishkin, 2001, p
And that proves that the Bank would have to play a crucial role in these countries regarding inflation policies. (Hammermann; Flanagan, 2009, p
Under these circumstances it can be shown that the central bank per se cannot by its actions control or regulate any economic force except with the consent and cooperation of the government and the policies of the ruling ministry. (Heenan; Peter; Roger, 2006, p
However the impact of the banks actions in developing countries has not yet been conclusive according to the IMF it was acknowledged that inflation control for the developed nations could be verified with the inflation targeting methods, but such data is not much in evidence for the developing countries. (Jacome; Vazquez, 2005, p
Thus while the actions of the Central Bank does play a role in inflation management; it is not the unique and central factor that determined the success of the policies. (Klomp; de Haan, 2010, p
However it doers not become a sin qua non-for the control of inflation. (Maliszewski, W
These activities and regulations have a great impact on the economy. (Munoz, 2007, p
Thus a central bank with government intervention will not be successful in the objectives. (Salvatore, 1991, p
In a depression the Central bank tries to achieve a targeted inflation rate to support the economy and vice versa. (Schaechter; Stone; Zelmer, 2000, p
In the research where the De Facto JI and central bank turnover indices, were compared for judicial and Central Banking autonomy it was found that a significant coefficient of correlation showed that where the independence of the Bank was at par with the Judiciary, there was more effect in its actions towards inflation. (Tridimas, 2011, p
All the central banks that came into existence before 1850 were established in the context of wars. (Broz, 1998) The two major central banks that existed in the United States of America between 1791 to 1850 were the first and the second bank of the United States of America
However, with the passage of time there has been a significant change in their way of conducting their operations. (Goodhart) References Bordo, M
Estimates of the depth of the problem were provided by UBS AG, the largest Swiss bank released estimates that the proposals of the G-20 might force banks to raise as much as $375 billion dollars in fresh capital. The Canadian Bankers Association Chief Executive Officer Nancy Hughes Anthony stated on June 8, 2010 that the G-20 policy proposals are "too onerous" and "could potentially choke the banking industry (Deslongchamps & Quinn, 2010)
This makes the Canadian dollar the third-worst performer for the last month among the U.S. dollar's 16 most-traded counterparts (Fournier, 2010)
¶ … Central Bank of Canada's, the author will move on from central banking issues, the transmission of money to a more thorough analysis of the supply of money on to a more thorough analysis of foreign currency markets, money and inflation and its inverse factor deflation and the impact of globalization upon the Canadian economy. Much of this market fluctuation centers around the fact that "the Bank of Canada's primary mandate is one of ensuring that the economy operates as close to price stability as possible (Rosenberg, 2010)
In effect, the banks' reserves ("R") are tools that can be used to further manipulate the financial sector of the Chinese economy as well as the interest rates and currency strength. This occurs through increased reserve requirements, which helps to stem the possibility of inflation by keeping the banks' assets and capital locked up and illiquid (McConnell, Brue, and Flynn, 2008)
As we suggest in the following section, that perspective increases the model's applicability to existing central banks, but misses important aspects. A more thoroughgoing attempt to go beyond the labor market orientation of central bank models, is Backus & John's construction of a model (Backus & John 1985) in which the structural characteristics of the labor market are integrated with other structural features of the economy to explain the determinants of monetary policy