Indian currency rupee is depreciating rapidly against the US dollar and other foreign currencies. This paper analyses the major causes of this depreciation. It also discusses its cures.

The paper establishes that sovereigns, like banks, need a lender of last resort (LoLR). In the euro area the ECB, with its estimated €3.4 trillion non-inflationary loss absorption capacity, is the only credible sovereign LoLR. The ECB/Eurosystem has been acting as sovereign LoLR through its...

Citizens’ trust in economic institutions has generally declined since the onset of the crisis. In particular, Eurobarometer surveys show that trust in the European Central Bank (ECB) has fallen significantly during the crisis. This paper studies the determinants of public trust in the ECB over...

The implications of central bank collateral requirements for the monetary policy transmission mechanism and the working of the money market have often been neglected. Such implications, however, have clearly manifested during the course of the 2007-2009 crisis. As liquidity was vanishing in the...

This paper contributes to a better understanding of how inflation targets are set. First, we gather evidence on how inflation targets are set from official central bank and government publications and from a questionnaire of our own design. Second, we estimate the determinants of the level of...

Abstract. This paper deals with a still unresolved issue - credit creation and control- in an interest free banking system. The available literature on the subject is scanty, controversial and inconclusive. The paper holds that credit creation per se is not un-Islamic; the essential point is how...

In recent years, as a result of the financial crisis, several proposals have been put forward to restore some role for gold in the monetary system. In particular, there has been a proposal to employ gold as a nominal anchor or asset for the exchange rates between the most important and tradable...

Since the implementation of a new explicit inflation targeting policy in 2005, CBRT has followed a more transparent communication strategy. This has made more information available to markets regarding its decision making process in order to increase predictability. Within this framework, MPC...