In 2008 the Bank of Mexico formally replaced its policy instrument, moving from a quantitative guideline (the “corto”) to the overnight interest rate used in the interbank market.
If sustained such measures could have a long-lasting impact on global trade and, hence, global economic activity. Reflections for monetary policy Clearly, all phases that I have outlined also come with important policy challenges for central banks. As discussed, in the preservation phase, the brief for monetary policy is fairly straightforward.