Alvin Hilaire: Monetary policy in Trinidad and Tobago - how it stacks up to other central banks

Address by Dr Alvin Hilaire, Governor of the Central Bank of Trinidad and Tobago, at the Launch of the Monetary Policy Report, Port of Spain, 23 November 2017.

The views expressed in this speech are those of the speaker and not the view of the BIS.

1. Central banks worldwide are making increasing efforts to lift the veil of mystery that has traditionally enveloped the world of monetary policy. Apart from making transactions with notes and coins, the general public often has very little notion of what goes on at a central bank. For most people-apart from perhaps academics and those involved directly in finance-their eyes glaze over when seemingly esoteric concepts involving monetary aggregates, transmission mechanisms and global interest parity conditions are used to explain what the institution does. What they do relate to, however, is how much their notes and coins can purchase over time! This simple consideration-the changing value of money as represented by the inflation rate-is really at the core of monetary policy. Of course, in a world with 24/7 financial transactions, goods and services changing hands by the second, and instantaneous cross-border capital flows, keeping inflation in check requires some deft maneuvering by a central bank.