COORDINATION BETWEEN MONETARY POLICY AND FISCAL POLICY IN THE DEVELOPMENT OF THE CORPORATE SECURITIES MARKET
COORDINATION BETWEEN MONETARY POLICY AND FISCAL POLICY IN THE DEVELOPMENT OF THE CORPORATE SECURITIES MARKET

Summary/Abstract: One of the most important goals of macroeconomic policy (pursued) which is implemented in a national economy is to ensure sustainable economic growth, with price stability and external trade balance. In order to achieve such growth, it is necessary to have a high degree of harmonization between the monetary and fiscal policy makers.Тhe coordination between fiscal and monetary policy is necessary in every economy, although it may have a different form, which is conditioned by the degree of its development and is necessary for the macroeconomic stability of the national economy. Successful coordination requires a developed financial market, transparent implementation of fiscal policy and autonomy in the operation of the Central Bank. Otherwise, the lack of coordination would lead to poor overall economic performance: macroeconomic instability and uncertain environment for the private sector, uncontrolled rise in inflation, which leads to a loss of credibility of policy makers. Of special mutual interest of both policies, both fiscal and monetary policy, is the development of the financial market, which in turn affects the development of economic life in the national economy, provides opportunities for market financing of the deficit and debt, as and the promotion of indirect monetary instruments. The developed government securities market is important for the private and public sector but also for the financial sector as a whole because it offers reliable instruments for saving and investing. Thus, the continuous improvement of the cooperation between the monetary authority and the fiscal authority is a necessity in order to ensure macroeconomic stability, the lowest costs for financing the public debt and especially the development of the financial markets.

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