Features of the monetary policy of central banks to combat high inflation

Keywords: inflation, inflation target, monetary policy, development markets, monetary transmission, prime rates, credit markets, monetary regime


The article describes the measures taken by the central banks of the world's largest economies to combat high inflation. The authors give a definition of what exactly is considered high inflation, analyze the timeliness and effectiveness of taking anti-inflationary measures, and also answer the question of the need for the monetary authorities to react to inflation, which does not have an obvious monetary nature.

In the article the particular attention is paid to the difference between the anti-inflationary policy of central banks in developed and emerging markets, as well as to the issues of coordination between the actions of the central bank and the government in the field of anti-inflationary policy. The authors point out the importance of increasing the efficiency of the transmission mechanism through the development of various segments of the financial market, including the derivatives market.

As a result of the study, a hypothesis is put forward that there is a direct relationship between the development of the financial market, especially the capital market, and the costs of fighting inflation. Countries with less developed capital markets and smaller gold and foreign exchange reserves are forced to use the key rate of central banks to fight inflation, paying with their economic growth potential for the opportunity to have low inflation.

The article also makes a fundamental conclusion that the risk of inflation has acquired global features, however has not yet affected all countries, bypassing those markets that traditionally struggled with the deflation factor, and their central banks had negative rates. As well, the article pays attention to the dependence of the foreign exchange rate on the difference between the levels of interest rates, and makes assumptions about the possibility of manipulating the foreign exchange rate through delaying anti-inflationary measures in order to stimulate exports.

Author Biographies

Vitaliy Shapran, National Bank of Ukraine

Professor, Ph.D. in Economics

Igor Britchenko, University of Security Management in Košice

Dr. of Sciences, Professor


Data base news agency Reuters.
Data base news agency Bloomberg.




Annual Report on Exchange Arrangements and Exchange Restrictions 2020.

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How to Cite
Shapran, V., & Britchenko, I. (2022). Features of the monetary policy of central banks to combat high inflation. VUZF Review, 7(2), 17-24. https://doi.org/10.38188/2534-9228.22.2.02