The Asia-Pacific region contains some of world’s most dynamic economies. Economies around the globe rely on credible monetary policy implemented by central banking institutions. Monetary policy governs the liquidity available to the payment systems that underlie trade and finance. Smooth adjustment of liquidity can minimize instability in money and foreign exchange markets and keep inflation and growth on a secure footing. The industrial giants of China, Japan, and Korea; the Southeast Asian emerging markets of Indonesia, Malaysia, Philippines, and Thailand; and the international entrepots at Hong Kong and Singapore each face unique challenges in implementing liquidity policy.
This advanced course will build a foundation for understanding liquidity policy implementation in the Asia-Pacific using standard economic models. The course will discuss the effects of high level discussion of a key element of national level public policy, monetary policy. Modern monetary policy connects macroeconomic conditions and key financial market indicators. It will also analyze the way that central bank goals for macroeconomic stability will determine outcomes in interest rates and exchange rates. The rigorous theoretical foundation should also build analytical skills that might be applied to policy and market analysis in a broad range of economies and even in the Asia-Pacific region as policy-making evolves in the future.
The topics covered each week are:
Module 1 - Monetary Policy Implementation
Module 2 - Monetary Policy Strategy
Module 3 - Exchange Rates and Monetary Policy
After taking this course, you will be able to:
(1) Describe Monetary Policy instruments central banks use
(2) Interpret on-going actions of central banks
(3) Apply graphical analysis and calculate basic economic measures used as tools by central banks or analysts
(4) Analyze the way that central bank goals for macroeconomic stability will determine outcomes in interest rates and exchange rates
Watch the introduction video to the course here: https://youtu.be/U7dQzqtIFVg

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Monetary Policy Implementation

Welcome to the first module! This module will focus on the microeconomics of monetary policy implementation. We study how the central bank balances supply against demand in liquidity markets to target the key interest rate on interbank lending and influence money markets.