Global Monetary Policy Implementation in 2021 Honourable Minister, Ladies and Gentlemen, monetary policy implementation in 2021 was generally accommodative at the global level, characterised by maintenance of relatively low policy rates, following the aggressive reduction of interest rates in 2020 in response to the COVID-19 pandemic.
But monetary policy also works by influencing expectations of future short-term interest rates and thereby affecting longer-term rates and asset prices. Central bank communications can help individuals, businesses, and investors formulate their expectations for interest rates and inflation in the future and thus influence their actions today.