Journal Article

Combining bank supervision and monetary policy

Abstract: In the United States, the Federal Reserve has responsibility for both monetary policy and bank supervision. Other countries separate these functions to varying degrees. What lies behind this global diversity? Should a central bank be charged with conducting monetary policy and regulating banks, or does it make more sense ? both economic and political ? to keep these activities separate? The answer is not a simple yes or no. Rather, it appears that the right choice depends on a country?s prevailing conditions, including its financial system, its political environment, and the preferences of the public.

Keywords: Banks and banking, Central; Bank supervision; Monetary policy;

Bibliographic Information

Provider: Federal Reserve Bank of Cleveland

Part of Series: Economic Commentary

Publication Date: 1996

Issue: Nov

Order Number: 1