Upon completion of this program, participants will be able to:

• Analyze the objectives, tools, and transmission channels of modern monetary policy.
• Evaluate different monetary policy frameworks, including inflation targeting and Taylor rules.
• Describe the practical implementation of policy through Open Market Operations (OMOs) and standing facilities.
• Interpret macroeconomic data to forecast inflation, output gaps, and policy responses.
• Assess the rationale and impact of unconventional monetary policies (e.g., Quantitative Easing).
• Understand the coordination and trade-offs between monetary, fiscal, and macroprudential policies.
• Discuss the challenges of monetary policy in a low interest rate or liquidity trap environment.
• Formulate policy recommendations based on economic modeling and forward-looking data analysis.

• Central Bank Monetary Policy Analysts and Economists
• Government Economic Policy Advisors
• Financial Market Traders and Portfolio Managers
• Treasury and Fixed Income Analysts at Commercial Banks
• Academics and Researchers specializing in Macroeconomics
• Financial Journalists covering Central Bank affairs

Economic model simulation, Policy committee role-playing, Case studies of historical policy decisions (e.g., 2008 crisis), Forecasting exercises using real-time data, Group debates on unconventional policy risks, Policy framework drafting.

Unit 1: Foundations and Frameworks

• The dual mandate: price stability and maximum sustainable employment.
• Key channels of monetary transmission (interest rate, credit, exchange rate, asset price, expectation).
• The concept of the **neutral interest rate** ($r^*$) and the effective lower bound (ELB).
• The role of inflation expectations and credibility in policy effectiveness.

• In-depth analysis of flexible inflation targeting (FIT) regimes.
• Exchange rate targeting and currency board arrangements.
• Nominal GDP targeting and alternative frameworks.
• Historical comparison of major central bank policy regimes.

Unit 2: Conventional Policy Implementation

• The role of the policy rate and the interest rate corridor system.
• Mechanics of Open Market Operations (OMOs) and repurchase agreements (Repos).
• The use of standing facilities (lending and deposit) to manage interbank liquidity.
• Operational challenges in maintaining the target rate within the corridor.

• Structure and process of policy-setting committee meetings.
• Data analysis and forecasting for policy decisions.
• The importance of **forward guidance** and expectation management.
• Communicating uncertainty and policy risks to the public.

Unit 3: Unconventional Monetary Policy (UMP)

• Rationale for UMP: addressing liquidity traps and dysfunctional markets.
• Balance sheet mechanics of QE and its impact on long-term rates.
• Targeted asset purchases and credit easing programs.
• The risks and eventual exit strategies for QE.

• Theoretical justification and practical implementation of NIRP.
• Impact on bank profitability, money markets, and household behavior.
• Policy tools to mitigate NIRP's negative side effects.
• Cross-country experiences with negative interest rates.

Unit 4: Policy Challenges and Coordination

• The short-run Phillips curve and the inflation-unemployment trade-off.
• Coordination with fiscal policy (e.g., debt management).
• Integrating financial stability objectives (e.g., asset price bubbles) into policy.
• Challenges in policy making in highly globalized and interconnected economies.

• Implications of a **Central Bank Digital Currency (CBDC)** on monetary policy implementation.
• The impact of structural trends (e.g., digitalization, demographics) on the neutral rate.
• Utilizing Machine Learning for enhanced forecasting and policy simulation.
• Policy setting during periods of high geopolitical uncertainty.