Central Bank Independence and Implementation of Monetary Policy
State Bank of Pakistan
Monetary Policy Department - Internship Project
“Central Bank’s Independence and Implementation of Monetary Policy”
By Raza Ali - SZABIST, Karachi & Farhan Ahmed - SZABIST, Larkana August- 2012
Internship Report
CERTIFICATE
It is to certify that this report submitted by Mr. Raza Ali and Mr. Farhan Ahmed is accepted in its present form by the Monetary Policy Department, State bank of Pakistan Karachi, as satisfying for the requirement for partial fulfillments of the Internship Program.
Supervisor Javed Iqbal
Central Bank’s Independence and Implementation of Monetary Policy
Page 2
Internship Report
Acknowledgement
We would like to thank Mr. Javed Iqbal (Monetary Policy Department) for his support and guidance during the preparation of this report. We would also like to extend our gratitude to the other staff members of the Monetary Policy Department who have remained supportive during our internship. We would like to thank the State Bank of Pakistan for providing us with this valuable opportunity and resources to conduct our research.
Central Bank’s Independence and Implementation of Monetary Policy
Page 3
Internship Report
Abstract
Economic indicators like Inflation, GDP growth, Borrowing from Central bank, Monetary Policy and CBI, Nominal and Real interest rates, Wage rates and Output sacrifice ratio have been analyzed to explore the effectiveness of Monetary Policy in Pakistan. Analysis of various economic indicators show that performance on these indicators could have been better had our monetary authorities had more autonomy.
Central Bank’s Independence and Implementation of Monetary Policy
Page 4
Internship Report
Table of Contents
Introduction………………………………………………………………………………………………………………Page06 Literature Review………………………………………………………………………………………………………Page7-9 Defining Central Bank Independence (CBI)………………………………………………………………..Page10 Measuring Central Bank Independence
Monetary Policy Department - Internship Project
“Central Bank’s Independence and Implementation of Monetary Policy”
By Raza Ali - SZABIST, Karachi & Farhan Ahmed - SZABIST, Larkana August- 2012
Internship Report
CERTIFICATE
It is to certify that this report submitted by Mr. Raza Ali and Mr. Farhan Ahmed is accepted in its present form by the Monetary Policy Department, State bank of Pakistan Karachi, as satisfying for the requirement for partial fulfillments of the Internship Program.
Supervisor Javed Iqbal
Central Bank’s Independence and Implementation of Monetary Policy
Page 2
Internship Report
Acknowledgement
We would like to thank Mr. Javed Iqbal (Monetary Policy Department) for his support and guidance during the preparation of this report. We would also like to extend our gratitude to the other staff members of the Monetary Policy Department who have remained supportive during our internship. We would like to thank the State Bank of Pakistan for providing us with this valuable opportunity and resources to conduct our research.
Central Bank’s Independence and Implementation of Monetary Policy
Page 3
Internship Report
Abstract
Economic indicators like Inflation, GDP growth, Borrowing from Central bank, Monetary Policy and CBI, Nominal and Real interest rates, Wage rates and Output sacrifice ratio have been analyzed to explore the effectiveness of Monetary Policy in Pakistan. Analysis of various economic indicators show that performance on these indicators could have been better had our monetary authorities had more autonomy.
Central Bank’s Independence and Implementation of Monetary Policy
Page 4
Internship Report
Table of Contents
Introduction………………………………………………………………………………………………………………Page06 Literature Review………………………………………………………………………………………………………Page7-9 Defining Central Bank Independence (CBI)………………………………………………………………..Page10 Measuring Central Bank Independence
References: Internship Report effective” 8th June, 2012