Central banks have been making headlines recently due to significant policy decisions aimed at addressing economic challenges. For instance, Turkey's central bank chief, Hafize Gaye Erkan, resigned amidst allegations of family interference, leading to the appointment of Fatih Karahan as her successor. In Russia, the central bank raised its key interest rate by 200 basis points to 15% in an effort to combat inflation and stabilize the weakening rouble. The Russian ruble's decline past 100 against the dollar has also raised concerns about economic instability and slower growth in the country.
Central banks are institutions responsible for managing a country's currency, monetary policy, and overseeing the commercial banking system. They play a crucial role in regulating money supply, interest rates, and inflation to maintain economic stability. Central banks often make decisions on interest rates, open market operations, and currency interventions to achieve their monetary policy objectives. These institutions are key players in shaping a nation's economic landscape and are closely monitored by financial markets and policymakers for their impact on the economy.