1 Introduction The global financial crisis (GFC) underlined the importance of financial stability. Monetarypolicy proved to be insufficient in safeguarding the stability of the financial system on its own, as well as might have additionally fuelled
During the last couple of decades, the main tool of monetarypolicy in the developed countries was interest rate steering. The central banks tried to influence national retail rate levels (and
market operations. From the perspective of the monetarypolicy what matters is the fact that the instruments' liquidity influences the smooth functioning of the entire financial network, the amount of new investments and the balance sheets of all
Authors:Péter Ákos Bod, Orsolya Pócsik, and György Iván Neszmélyi
outsiders, even without a target date, while Slovakia, also a V4 country has been an EA member since 2009.
Our research process has acknowledged that a currency regime choice such as the euro adoption is, on the face of it, a monetarypolicy
enormous sums from the state budget. The fiscal expansion was counterbalanced by restrictive monetarypolicy of the MNB in the form of raising the rate of interest, but it did not stop the households, the non-financial sector and the banks to borrow from
the market economy.
The reasons for this disconnect are largely two: tax policy in recent decades and recent monetarypolicy. It would be impossible to discuss those policies in detail here. Therefore, we shall limit ourselves to some rather
nominal exchange rates and more broadly, own monetarypolicy ( Mundell 1961; McKinnon 1963; Kenen 1969; De Grauwe 2012 ). To put it otherwise, currency unions create a trap or an impossible trinity. The trilemma states that out of exchange rate stability
, fiscal and monetarypolicy are useful tools to manage cyclical slowdown, but much less useful in counteracting secular, structural decline. As I illustrated above, pre-virus growth rates were halved in a decade, and that despite the ongoing joint fiscal
likelihood of privatization grows when it is important to decrease government spending. This strengthens the position of the Treasury or finance minister in their bargaining with “spending” ministries, just as a strict monetarypolicy does ( Boyco et al. 1996