This open access book gives a concise introduction to the practical implementation of monetary
policy by modern central banks. It describes the conventional instruments used in advanced
economies and the unconventional instruments that have been widely adopted since the financial
crisis of 2007-2008. Illuminating the role of central banks in ensuring financial stability and
as last resort lenders it also offers an overview of the international monetary framework. A
flow-of-funds framework is used throughout to capture this essential dimension in a consistent
and unifying manner providing a unique and accessible resource on central banking and monetary
policy and its integration with financial stability. Addressed to professionals as well as
bachelors and masters students of economics this book is suitable for a course on economic
policy. Useful prerequisites include at least a general idea of the economic institutions of an
economy and knowledge of macroeconomics and monetary economics but readers need not be
familiar with any specific macroeconomic models.
