Prerequisites for Inflation Control

EghtesadOnline: If the government tries to observe financial discipline and avoids tapping into monetary resources to cover its expenses, we can be hopeful about the control of liquidity growth and inflation.

News ID: ۷۵۲۴۱۷

18 April 2023

If the government tries to observe financial discipline and avoids tapping into monetary resources to cover its expenses, we can be hopeful about the control of liquidity growth and inflation. In addition, the financial discipline of banks, both in asset and debt management as well as liquidity management, is the second necessary condition for controlling inflation.

Here, the Central Bank of Iran, as a supervisory body, should introduce precautionary regulations in banks and require the banking system to comply with them. Violation of regulations should also be strongly confronted by the monetary policymaker. These were stated by Kamran Nadri, an economic expert, in a write-up for the Persian daily Jahan-e Sanat.