Monetary policy operations of debtor central banks in MENA countries

Gunther Schnabl and Franziska Schobert

No 65, Working Papers from University of Leipzig, Faculty of Economics and Management Science

Abstract: The paper analyses the monetary policy operations of central banks in the Middle East and North Africa (MENA). We distinguish the pattern of monetary policy operations of the liquidity providing central banks of the large industrialized countries (creditor central banks) and the liquidity absorbing central banks of emerging market economies (debtor central banks). Many debtor central banks provide liquidity through foreign exchange intervention in reaction to foreign exchange inflows. If the respective liquidity expansion is regarded as a threat to domestic price and financial stability, liquidity is partly absorbed through sterilization operations. The paper finds that most MENA countries are debtor central banks due to a general pattern of excessive liquidity creation as well as due to country specific reasons.

Keywords: Emerging Markets; Debtor Central Banks; Foreign Exchange Inflows; Sterilization (search for similar items in EconPapers)
JEL-codes: F31 (search for similar items in EconPapers)
Date: 2007
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Citations: View citations in EconPapers (2)

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Working Paper: Monetary Policy Operations of Debtor Central Banks in MENA Countries (2007)
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:leiwps:65

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