Macroeconomic policy of central banks under the modern conditions

Zherdetska Liliia
D.Sc. (Economics), Associate Professor, Head of the Banking Department, Odesa National Economic University, Odesa, E-mail:lzherdetska@gmail.com, ORCID ID: https://orcid.org/0000-0001-5398-868X

Kambur Mariia
6th year student of the Odesa National Economic University, Odesa, E-mail:maskambur@gmail.com, ORCID ID:

Cite this article:

Zherdetska L., Kambur M. (2023) Macroeconomic policy of central banks under the modern conditions. Ed.: V.V. Kovalenko (ed.-in-ch.) and others [Makroekonomichna polityka tsentralnykh bankiv u suchasnykh umovakh; za red.: V.V. Kovalenko (gol. red.)], Scientific Bulletin of the Odessa National Economic University (ISSN 2313-4569), Odessa National Economics University, Odessa, No. 1-2 (302-303), pp. 65-74.

Abstract

Introduction. The current conditions shaping the economic environment are not related to excessive growth, but rather to problems in resuming economic growth and deepening recession. The main challenges of modern environment, that require improvement of approaches to the use of macroeconomic policy, are the following: quarantine restrictions in connection with the Covid-19 pandemic; geopolitical instability and war in Ukraine in connection with aggression from russia. Purpose. Improvement of methodological approaches to assessing results of the macroeconomic policy of central banks under the modern conditions. Results. Based on the results of the analysis, it was established that in response to the crisis caused by pandemic restrictions, central banks mitigated the tools of macroprudential policy. It was established that such regulatory actions were sufficiently synchronous for most countries. However, uneven recovery of national economies and differences in the regulatory landscape led to different rates of renewal of macroprudential restrictions. The next factor that shapes the current conditions for the formation and implementation of macroeconomic policy is the full-scale invasion of russia into Ukraine. On this basis, the research analyzed the actions of the National Bank of Ukraine in the field of monetary, currency and prudential regulation. It has been established that in the current conditions a monetary restrictive policy with a simultaneous softening of the macroprudential toolkit and a number of fiscal measures that should contribute to the restoration of bank lending appears to be fully justified. In the field of prudential policy and banking supervision, it is necessary to highlight the following measures: - special mode of operation of legislative acts (for example, the Regulation on the determination by banks of Ukraine of the amount of credit risk for active banking operations); - mitigating of the conditions for conducting bank stability assessments in 2022 (non-application of influence measures for violation of economic regulations and currency position limits); - relaxation of requirements regarding reporting deadlines for all financial market participants; - reduction of risk weights for unsecured consumer loans from 150% to 100%. Conclusions. Therefore, during the period of the corona crisis and at the beginning of full-scale aggression by the russian federation, the anti-crisis policy of the NBU is characterized by the mitigating of measures in the field of monetary regulation and banking supervision (the only exception is currency regulation). Such measures in the conditions of pandemic restrictions made it possible to somewhat revive the development of lending and ensure the accumulation of the necessary capital by banks. In the conditions of war, taking into account the forecast of a significant increase in inflation and a fall in GDP, a restrictive monetary policy with a simultaneous softening of the macroprudential toolkit and a number of fiscal measures that should contribute to the restoration of bank lending appear to be fully justified.

Keywords

monetary policy, macroprudential policy, Covid-19 pandemic, full-scale invasion, anti-crisis measures.

JEL classification: E320, G210; DOI: 10.32680/2409-9260-2023-1-2-302-303-65-74

UD classification: 336.71:330.101.54

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