What is Monetary Policy?
Monetary Policy is the set of measures adopted by the Central Bank or other monetary authority that is aimed at influencing the availability and cost of money and credit, with a view to achieving specific national goals such as a low, stable and predictable rate of inflation and sustained economic growth.
The Bank of Guyana Act sets out the Bank's principal objectives as follows:
Within the context of the economic policy of the Government the Bank shall be guided in all its actions by the objective of fostering domestic price stability through the promotion of stable credit and exchange conditions, as well as sound financial intermediation conducive to the growth of the economy of Guyana.
Instruments of Monetary Policy
The Bank of Guyana utilizes two instruments in the conduct of monetary policy. These are:
- Reserve Requirements.
- Open Market Operations.