Core Functions of Central Banks: Foundations, Policy, and Stability (3-days)

What you will learn

By the end of this course, you will be able to implement a successful strategy that enables you to:

• Explore the historical development of central banks and financial systems, their core mandates (price stability, sustainable growth, financial stability), and how these roles evolved across global and regional contexts.
• Understand central banking functions including monetary policy, lender of last resort, and financial system oversight; review governance models, independence, boards and committees, and institutional accountability.
• Understand and compare how central banks operate under different mandates across global models, and evaluate how these mandates shape their functions, priorities, and governance structures.
• Learn how interest rates, open market operations, and reserve requirements influence economies, and explore newer tools like quantitative easing, negative interest rates, and yield curve control (YCC), with a case study on the Bank of Japan.
• Examine how central banks responded to the 2008 financial crisis and the COVID-19 pandemic, comparing tools, timing, and effectiveness across different contexts.
• Analyse the use of conventional and unconventional monetary policy tools, assess central bank responses to financial crises, and evaluate the impact of these policies on economic stability and recovery.
• Understand the importance of financial stability, how to identify systemic risk through indicators like credit growth and leverage, and explore macro-risk tools such as stress testing and early warning systems.
• Learn to interpret Financial Stability Reports (FSRs), communicate risks effectively, and apply composite indicators to monitor market vulnerabilities.
• Explore principles of good governance, transparency, and ethical integrity in central banking, and take part in a crisis scenario where participants draft a strategic press release during a reputational risk event.