Abstract:

After the global financial crisis, the monetary policy of the central banks has changed significantly. In the pre-crisis period, the central banks focused only on price stability, and the financial stability, along with the crisis, was also taken into account. On the other hand, the instruments used by the central banks for monetary policy are not unlimited. In particular, as the global financial crisis turns into the European debt crisis, developed countries’ central banks have applied to non-traditional monetary policies to revive the real economy. In this context, developed countries’ central banks have reduced their interest rates aggressively to zero. Thus, with the practices of non-traditional monetary policies, the central banks have expanded their balance sheets and the monetary base has been significantly increased. The goal of central banks at this point was to try out of the deflation process due to the narrow global demand. For this purpose, this study focuses on the monetary policy practices and outcomes of central banks (FED, ECB, BOJ and BOE) which are considered to be major along with the global crisis. Another objective of the study is to draw attention to the discussions on the effectiveness of the monetary policies after the global crisis.

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