TARGET GROUP | Mid- to senior-level officials from central banks, ministries of finance, or regulatory agencies with an interest in monetary policy, macroprudential policy, and financial stability.
DESCRIPTION | The objective of this course is to examine the interactions of monetary and financial stability policies and their implications for policy design. The course will first discuss the objectives and evolving tools of both policies, explore their role and effectiveness in different phases of the business and financial cycles, and summarize lessons learned since the crisis. Based on an analysis of the complementarities, possible side effects, and potential conflicts between the two policies, the course will then address such challenges as the role of asset prices in both policies and the extent to which monetary and financial stability policies can and should be operated independently, with separate decision-making, accountability, and communication structures. Alternative institutional arrangements for monetary and macroprudential policy will be reviewed, using the example of the Bank of England’s Monetary Policy Committee and Financial Policy Committee, but drawing also on other case studies. The course requires a high level of participation, through discussions and short participant presentations on the topic of the course based on individual country experiences. The lectures will be supplemented by hands-on workshops.