The State Bank of Vietnam (SBV) is currently Chair of the South East Asian Central Banks Research and Training Centre (SEACEN) in 2022. Within the framework of the 21st SEACEN Executive Committee (EXCO) Meeting, on September 15, 2022, SBV Deputy Governor Pham Thanh Ha chaired the SEACEN-BIS High-level Seminar held in Da Nang with the themes focusing on the issues currently receiving a lot of attention, i.e. the inflation, the frameworks for macro financial stability in the emerging economies.
In his opening speech at the Seminar, Deputy Governor Pham Thanh Ha asserted that the world economy and the global market have been experiencing unprecedented instabilities. Although the world economy has still been in the post-COVID recovery process, it has suffered a series of shocks and potential risks due to the geo-political conflicts, rising fuel prices, and the disruptions in the global supply chains. In that context, the Deputy Governor emphasized that, for central banks, it is necessary to be consistent with the monetary policy management in order to achieve the goals of controlling the inflation and maintaining the macro-economic stability. Moreover, the monetary policy should be closely harmonized and coordinated with the fiscal policy, the macro safety policy, and other macro-economic policies towards a good balance among all objectives.
An overview of the Seminar
At the Seminar, several presenters and senior managers from the SEACEN and BIS members, the World Bank and Stanford University shared their perspectives on the monetary policy management, especially the importance of the coordination between the monetary policy with the fiscal policy and other macro-economic policies, in order to address the issue of inflation related challenges. The participants also assessed that the inflation should currently be the top priority, and the monetary policy should be adjusted in an appropriate and active manner for economies to avoid falling into a new era of inflation. At the same time, the policy communication and risk controlling should also receive a lot of attention.
In addition, the participants also emphasized the importance of and need for frameworks for the macro-economic stability with the aims of achieving the goal of maintaining the domestic macro-economic stability through the consistent coordination of different policies, including (i) the two main pillars being the monetary policy and the fiscal policy, and (ii) the additional instruments, including the macro safety policy, the capital flow management, interventions in the forex market in order to support the monetary policy and the fiscal policy. In the context of challenges from the external financial conditions and the domestic financial imbalances affecting the monetary policy and the fiscal policy, the central banks’ policy actions need to be proactive and responsive to the macro financial risks.
Le Hang