BSL holds first annual conference

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The acting Bank Governor,Ibrahim Stevens and others at the conference

By Ishmael Dumbuya

Bank of Sierra Leone has on May 9th  held its first annual conference at the Bank of Sierra Leone Recreation Complex, Kingtom in Freetown. The conference was geared towards the discussion of the difference between inflation and monetary decisions.

In his keynote Address, the Acting Bank Governor, Bank of Sierra Leone, Dr. Ibrahim L Stevens stated that the bank will be meeting on a quarterly basis in order to take monetary decisions.

He added that inflation targeting means the Central Bank conducts monetary policy such that it comes as close as possible to creating (or rather, setting the macroeconomic conditions for markets to create) a pre-specified rate of inflation in every time period.

He went on to state that it is easy for the public, in their capacity as market actors, to understand. 

“Easily-understandable rules are better for securing economy-wide coordination of production and consumption choices.  Second, it provides a clear time path for the purchasing power of money.  Regular inflation, so long as it is low and predicable, probably does not hamper economic coordination, and by providing a long-term commitment for the rate of change of money’s purchasing power, market actors can safely make longer-term contracts than otherwise, which is beneficial for economic growth.  Third, it also can stabilize the economy in response to aggregate demand shocks.  For example, if the demand to hold money suddenly and unexpectedly rises, BSL will have to engage in expansionary monetary policy if it wants to continue to hit its target.  “From the standpoint of monetary equilibrium theory, this is desirable because it prevents unnecessary fluctuations in output and employment that would otherwise result from an unmet excess demand for money,” he stated.

The Acting Governor indicated that the current inflationary trends and monetary policy operations were great as a result of the COVID 19 and the ongoing war between Ukraine and Russia.

He however noted that the Bank of Sierra Leone is committed to monitoring price stability, noting that the Bank of Sierra Leone is the first in the sub region to hold a conference on inflationary trends and monetary policy.

He concluded that this year’s forum was organized in order for BSL staff to interact with researchers and stakeholders in the banking sector, as the BSL largely depends on evidence-based policy and expert advice.

The Deputy Governor, BSL, Sheik A.Y. Sesay, threw light on financial stability and monetary policy, adding that the two concepts focus on research which is key to evidence based policy making.

In addition to that, he said dissemination of research output is an integral part of research.

He further stated that in recent years in the country, the economy has been through some difficult times largely as a result of COVID and the war between Ukraine and Russia, and as a result, families have struggled to keep their heads above water financially.

He added that even those that were lucky enough to keep their jobs may have found that their salaries didn’t go as far as they once did or that they no longer had the financial resources available to them in order to enjoy life’s luxuries.

“It can be very stressful when you don’t know how much money will come into your household each month so being able to save up something for a rainy day or an unexpected expense can help ease this stress immensely,” he indicated.

He concluded by stating that financial stability allows people to make reasonable plans for future expenses, save money for retirement or major purchases, invest in other things and meet emergency expenses without incurring debt, adding that it also helps getting rid of existing debt, especially extreme debt.

The opening session of the conference ended with the launch of various publications by the Acting Bank Governor. Publications such as Bank of Sierra Leone Policy brief, BSL Handbook, BSL Special Research Bulletin, BSL Working Paper, BSL Macroeconomic and Financial Statistics, BSL Annual Macroeconomic Statistics and BSL Economic Review were launched.

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