Introduction: the role of central banks in economic.
The role of banks in economic development is to remove the deficiency of capital by stimulating savings and investment. A sound banking system mobilizes the small and scattered savings of the community, and makes them available for investment in productive enterprises.The role of Central bank in macroeconomic stabilization Chandavarkar (1996 cited in Geraats, 2002) claims that macroeconomic stabilization is the pivotal role of the Central Bank. The stabilization duties include such aspects as the stabilization of the domestic price level and exchange rate as well as domestic payment systems.The central banks play a very important role in the economic policy formation and execution. These are the big players in an economy that controls the flow of money in an economy.
Commercial banks have played a critical role in the economic development of a country. Now a day’s commercial banks are important not just from the point of view of economic growth, but also financial stability. In emerging economies, commercial banks are special for three important reasons.Role of Central Bank .Role of the Central Banks and their involvement with Government Fiscal Policy Introduction: The central bank is the public sector bank of a country which owned by the government and not by the private sector. It is responsible for major financial, economic status of a country.
The central bank in a developing country aims at the promotion and maintenance of a rising level of production, employment and real income in the country. The central banks in the majority of underdeveloped countries have been given wide powers to promote the growth of such economies.
