Recent Challenges to the Conduct of Monetary Policy in the WAEMU: WAEMU

This paper discusses recent challenges in BCEAO monetary policy, from a recent spike in inflation, the persistent erosion of external reserves, and strains in the regional financial market.
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Volume/Issue: Volume 2024 Issue 013
Publication date: May 2024
ISBN: 9798400274121
$15.00
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Topics covered in this book

This title contains information about the following subjects. Click on a subject if you would like to see other titles with the same subjects.

Banks and Banking , Finance , Investments and Securities-General , Money and Monetary Policy , International - Economics , BCEAO , WAEMU , monetary policy , CFA franc , BCEAO purchase , conduct of monetary policy , viability challenge , BCEAO refinancing , FX reserve , Liquidity , Central bank policy rate , Securities , Financial sector stability , International reserves , Global , West Africa

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Summary

This paper discusses recent challenges in BCEAO monetary policy, from a recent spike in inflation, the persistent erosion of external reserves, and strains in the regional financial market. In response to these shocks, the BCEAO operated via both policy rates and liquidity management, including by shifting from fixed to variable rate auctions. The paper finds that the conduct of monetary policy became progressively more constrained by financial stability and external viability challenges, arguing for enhanced monetary-fiscal policy coordination to help the BCEAO meet its reserves objectives.

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