Monetary Policy

The monetary policy of any economy relates to the regulation of coin supply by the financial authority of that economy, usually the telephone exchange bank, in order to maintain financial stability and conjure up sparing growth. In light of the current economic situation, the key bank would decide whether to implement an expansionary monetary policy or a contractionary monetary policy. An expansionary policy tends to increase the supply of bullion in the economy while a contractionary policy expands the property supply more slowly than usual or level off shrinks it. Expansionary policies are aimed to reduce unemployment during recession times through the reducing of interest grade, an attempt to spur investment and increased business. Contractionary policies, however, are aimed to slow inflation in hope of avoiding resulting distortions and deterioration of summation values. Traditionally Lebanon has enjoyed a free market economy with a history of minimal government intervention in economic activity, however, the state, represented by the central bank (BDL), holds widespread reserve on the monetary level.

Following the civil war, the government has follow a conservative monetary policy and an exchange rate-based stabilization policy in order to curb the inflation that rocketed to 131% in 1992 due to money printing strategies. Moreover, and in order to ascension the value of the Lebanese Pound, the government offered high interest pass judgment on LBP denominated securities - Interest rate levels on 6-month T-Bills reached a disposition of 36% in 1994. Apparently, this has led to a decline in the rate of inflation and reduction of money growth rates compared to pre-1993 levels. Going onwards, however, the central bank concentrated on encourage economic growth and de-dollarization strategies. The government managed to secure several care pledges, the latest of which being the Paris III Conference in 2007 where it managed to secure pledges amounting to nearly USD 7.8 billion for... If you want to get a full essay, order it on our website: Ordercustompaper.com

Ordercustompaper.com is a professional essay writing service at which you can buy essays on any topics and disciplines! All custom essays are written by professional writers!