Crisis and Monetary Policy

Global Financial Crisis and Monetary Policy Response in India (Speech delivered by Deepak Mohanty, Executive Director, check Bank of India at the tertiary ICRIER-InWEnt Annual Conference on 12th November, 2009 at modernistic Delhi.) I thank ICRIER and InWEnt for giving me this opportunity to speak to you this morning. In my talk, I will try to address the following specialise of questions: How and why was India impacted by the global monetary crisis? How did financial policy respond to the crisis? What was the impact of the policy on the Reserve Banks balance sheet? How did monetary transmittal system work?  I will conclude by high spot the challenges of exit from monetary easing. 2. The subprime crisis that emerged in the US housing mortgage market in 2007 snowballed into a global financial crisis, lead to a global economic recession. The financial landscape has changed importantly after the collapse of Lehman Brothers in September 2008. An important lesson learnt, post-September 2008, is that disregarding of the degree of globalisation of a country and the soundness of its domesticated policies, a financial crisis could spread to every economy. 3. The international transmission of liquidity shocks was fast and unprecedented.

While falling asset prices and suspicion about valuation of the traded instruments affected market liquidity, failure of track global financial institutions and the deleveraging process tightened the market for funding liquidity. attached the growing risk of illiquidity cascading into solvency problems, credit and quantitative easing acquired antecedency in most central banks. The contagion from the global financial crisis warranted swift monetary and fiscal policy responses with a charm to ensuring orderly functioning of markets, preserving financial stability, and moderating its adverse effect on growth.  While the global financial markets have since started covering signs of stabilisation, credit flow in advanced markets is yet to recover. How... If you regard to get a full essay, order it on our website: Ordercustompaper.com

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