Growing Central Bank Challenges in the World and Japan


A newly published ADBI Press book examines the impact of the increasingly uncertain, innovation-driven global environment on central bank policy making.


Growing Central Bank Challenges in the World and Japan by Sayuri Shirai, a former Bank of Japan Policy Board member, discusses central bank approaches to low inflation and new monetary challenges. It also explores emerging issues related to cash, crypto assets, and central bank digital currency, including the regulatory implications of the COVID-19 crisis.


“The COVID-19 crisis has added another layer of complexity to central banking, both from the standpoint of ensuring macroeconomic stability and cultivating and governing financial technology,” said Shirai, who recently completed her tenure as an ADBI visiting scholar. “In this environment, understanding available policy options is very important to effective central bank decision making.”


In part one of her book, Shirai assesses unconventional monetary easing tools prompted by low inflation in Japan and other advanced economies. Among the measures she discusses include new monetary policy frameworks to replace existing flexible inflation targeting and policy coordination such as helicopter money and modern monetary theory.


In part two of her book, the Keio University professor sheds light on the global rise in cash in circulation; recent movements in private money; “stablecoins” and Facebook’s Libra; central bank digital currency proposals; and new regulatory perspectives which take the COVID-19 pandemic into account.


The book offers policy makers, financial practitioners, market analysts, and other interested readers timely insights on how central banks are navigating the unsettled policy landscape and what the future may hold.

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