scholarly journals Book Review: Central Banking and Monetary Policy in Muslim-Majority Countries

2018 ◽  
Vol 6 (2) ◽  
pp. 107-115
Keyword(s):  
Monetary Policy ◽  
Central Banking ◽  
Muslim Majority

scholarly journals Sharīʿah-compliant central banking practices: lessons from Muslim countries’ experience

2020 ◽  
Vol 12 (1) ◽  
pp. 7-26
Author(s):  
Zaheer Anwer ◽  
Shabeer Khan ◽  
Muhammad Abu Bakar
Keyword(s):  
Monetary Policy ◽  
Central Bank ◽  
Islamic Law ◽  
Financial Institution ◽  
Central Banking ◽  
Policy Implications ◽  
Content Type ◽  
Muslim Countries ◽  
Muslim Majority ◽  
The Government

Purpose The purpose of this study is to document how a central bank can perform its primary and secondary functions in a Sharīʿah-compliant manner. It also seeks to investigate the outcomes of the experiments of Muslim-majority countries in this regard. Design/methodology/approach As a first step, a detailed review of existing literature is conducted, which discusses the views of scholars and practitioners on the central banking mechanism in a fully Sharīʿah-compliant financial system. Moving further, the case studies of Iran, Sudan and Pakistan are presented to highlight experiences of regulators from three Muslim-majority countries, which aimed to achieve full compliance with Sharīʿah (Islamic law) principles related to Islamic finance. To evaluate their models, an assessment of their practices is performed in the light of Sharīʿah rules and principles based on existing literature. Finally, the issues involved in establishing a Sharīʿah-compliant central bank (SCCB) are discussed and improvements are suggested. Findings It is found that Iran played an effective role in pursuing broader objectives of monetary policy by setting priorities for credit allocation and assisting the government in reducing expenses; however, with respect to instruments, its experience is limited to the rebranding of conventional products. Sudan has not only used monetary policy to effectively curb inflation but also it has introduced various indirect instruments to perform monetary operations. Pakistan succeeded in formulating a theoretical roadmap to establish a SCCB but the desired objectives could not be achieved because of multiple factors. Practical implications This study has important policy implications for regulators and policymakers from Muslim countries, who can use the findings in shaping effective Sharīʿah-compliant central banking practices in their respective countries. Originality/value This study discusses the salient features of an important Islamic financial institution, the central bank and evaluates the experiments of three Muslim-majority countries in implementing Sharīʿah-compliant central banking practices. To the best of the knowledge, this evaluation has not been performed in the existing literature and the present study fills in this gap.

Normative dimensions of central banking: How the guardians of financial markets affect justice

2017 ◽  
Author(s):  
Peter Dietsch
Keyword(s):  
Monetary Policy ◽  
Financial Crisis ◽  
Financial Markets ◽  
Central Banking ◽  
Democratic Legitimacy ◽  
Policy Agenda ◽  
Theory Of Justice ◽  
Introductory Section ◽  
The Impact

Monetary policy, and the response it elicits from financial markets, raises normative questions. This chapter, building on an introductory section on the objectives and instruments of monetary policy, analyzes two such questions. First, it assesses the impact of monetary policy on inequality and argues that the unconventional policies adopted in the wake of the financial crisis exacerbate inequalities in income and wealth. Depending on the theory of justice one holds, this impact is problematic. Should monetary policy be sensitive to inequalities and, if so, how? Second, the chapter argues that the leverage that financial markets have today over the monetary policy agenda undermines democratic legitimacy.

Monetary Policy and Central Banking

2012 ◽  
Author(s):  
Louis-Philippe Rochon ◽  
Salewa Olawoye
Keyword(s):  
Monetary Policy ◽  
Central Banking

Monetary Policy and the Future of Central Banking

2021 ◽  
pp. 9-14
Author(s):  
Mitsuhiro Furusawa
Keyword(s):  
Monetary Policy ◽  
World War Ii ◽  
Interest Rates ◽  
Global Economy ◽  
Commodity Prices ◽  
Central Banking ◽  
African Countries ◽  
Advanced Economies ◽  
Policy Frameworks ◽  
Forward Looking

The chapter highlights the state of monetary policy in Africa and explores the challenges that central banks face as they address the increasingly complex forces at work in the global economy. It sequences the evolution of monetary policy from the time of World War II under the Bretton Woods system to the more recent forward-looking monetary policy in advanced economies and relates it to influencing the evolution of monetary policy frameworks in Africa. Some challenges affecting African countries are identified, including the collapse of commodity prices, persistent high interest rates spreads, and limitations of high frequency data that constrain monetary authorities’ abilities to take corrective actions in a timely manner. The chapter concludes by providing seven principles towards increasing the effectiveness of monetary policy for countries seeking to move towards forward-looking monetary policy frameworks.

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