Presentation on International Business

Topic : The Role of Monetary Policy And IMF in International Business

SUBMITTED BY : SUBMITTED TO :
RABIUL KARIM AFIYA SULTANA
ID : 1600 ASSISTANT PROFESSIOR
SEMSETER : 5TH BBA,FBA,USTC

Faculty of Business Administration

University of Science and Technology Chittagong
 PRESENTATION
ON

Role of Monetary Policy And IMF in International

Business
Monetary policy, the demand side of economic policy, refers to the
actions undertaken by a nation's central bank to control money supply
and achieve macroeconomic goals that promote sustainable economic
growth.
 KEY POINTS OF MONETARY POLICY

 Monetary policy refers to the actions undertaken by a nation's central bank to control money
supply and achieve sustainable economic growth.
 Monetary policy can be broadly classified as either expansionary or contractionary.
 Tools include open market operations, direct lending to banks, bank reserve requirements,
unconventional emergency lending programs, and managing market expectations—subject to
the central bank's credibility.
 Types of Monetary Policy

Expansionary Contractionary
 OBJECTIVES OF MONETARY
POLICY
 Manage inflation. Most economists consider this the one true objective of monetary policy. In general, low
inflation is most conducive to a healthy, thriving economy. Therefore, when inflation is on the rise, the Federal
Reserve may adjust monetary policy to reduce inflation.

 Reduce unemployment. During depressions and recessions, unemployment rates tend to soar.
However, monetary policies also play a major role in unemployment rates.
 Balance currency exchange rates. Given that stable exchange rates play such a major role in
international trade, it's essential to find ways to keep them balanced. Central banks have the power to
regulate exchange rates between foreign and domestic currencies. For instance, if the central bank
opts to issue more currency to increase the money supply, domestic currencies become cheaper than
foreign currencies.
ROLE OF MONETARY POLICY IN
INTERNATIONAL BUSINESS
Developmental
Role

Long-Term
Effective Integrated Loans for
Central Interest Rate Industrial
Banking Structure Development

Maintaining
Equilibrium in
Balance of
Payments
INTERNATIONAL MONETARY FUND

The International Monetary Fund (IMF) is an international organization that promotes global
economic growth and financial stability, encourages international trade, and reduces poverty. Quotas
of member countries are a key determinant of the voting power in IMF decisions. Votes comprise one
vote per 100,000 special drawing right (SDR) of quota plus basic votes. SDRS are an international
type of monetary reserve currency created by the IMF as a supplement to the existing money reserves
of member countries
 INTERNATIONAL MONETARY FUND
ACTIVITIES
•Surveillance
The IMF collects massive amounts of data on national economies, international trade, and the global economy in aggregate.
The organization also provides regularly updated economic forecasts at the national and international levels. These forecasts,
published in the World Economic Outlook, are accompanied by lengthy discussions on the effect of fiscal, monetary, and trade
policies on growth prospects and financial stability.
•Capacity Building
The IMF provides technical assistance, training, and policy advice to member countries through its capacity building programs.
These programs include training in data collection and analysis, which feed into the IMF's project of monitoring national and
global economies.
•Lending
The IMF makes loans to countries that are experiencing economic distress to prevent or mitigate financial crises. Members
contribute the funds for this lending to a pool based on a quota system. In 2019, loan resources in the amount of SDR 11.4
billion (SDR 0.4 billion above target) were secured to support the IMF’s concessional lending activities into the next decade.7
ROLE OF INTERNATIONAL
MONETARY FUND
Exchange Stability

Eliminating BOP
Disequilibrium:

Stabilize Economies

Reducing Tariffs
 FUNCTIONS OF INTERNATIONAL
MONETARY FUND
Fixation of Par Value
of Currencies in terms Alternation of Limit Loans of Foreign
of Gold or Dollar within Par Value Currency

Drawing Rights Stand by Liquidity of Fund’s

Arrangements Resources

Currency in Short A Central Bank’s

Supply Bank
 CONCLUSION

Monetary policy and IMF both playing big role in international business. Both
help international business which help international business sector to be grow
more .