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Essay's paper info
| Topic: |
Business
|
| Number of pages / Number of words: |
3 / 693 |
Essay's paper body
So fiscal dominance may hamper the effectiveness of money market operations.
Page 14
POSSIBLE SOLUTIONS
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possible solutions could be:
1- Establishing a sound financial relationship between the central bank and government, this relation can be created through curtailing the ability of the government to rely on direct credit from the central bank...
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If the central bank uses the government securities issued for monetary policy purposes, or uses its securities ( or accept deposits ) the related costs are born by the central bank, and may lead to large losses for the central bank .In order to avoid the potential for profitability consideration to take precedence over monetary policy consideration ,it is important to take the necessary arrangements to ensure that the losses of the central bank are passed to government in a timely manner...
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General points of the essay
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