Conduct of Monetary Policy in Kuwait Essay Example | Topics and Well Written Essays - 500 words

Conduct of Monetary Policy in Kuwait - Essay ExampleIn enounce to accomplish these broad goals, CBK has been adept in controlling the level of the domestic money supply and polar interest rates. During the fiscal year 2005-2006, the broad definition of money supply or M2 amounts to KD14524.7 which represents a mental image digit increase of 17.2% from its previous level. This growth represents the ballooning of both quasi-money (18.6%) and narrow money (13.5%). The increase in money supply is attributed to the increase in both CBKs net contrasted assets by 31.1% and the net foreign assets of local banks by 14.4% (Annual Report 2005-06 15).The strict monitoring of interest rates is primarily attributed to CBKs efforts in ensuring their consistence with the domestic economic and monetary developments (Annual Report 2005-06 16) and their alignment with trends in major currencies (Annual Report 2005-06 16). In general, this is to kindle the competitiveness and attractiveness of Kuw aiti dinar relative to foreign currencies.