Monetary policy in the conditions of global instability: conclusions for Ukraine


The paper considers the monetary policy of leading world central banks that have been used to overcome the global financial and economic crisis in 2008-2009. Advanced developed countries, which are current world’s technological leaders, managed to overcome this crisis, primarily through monetary mechanisms. For this purpose, a non-traditional monetary policy was invented and applied for the first time. It included the following: quantitative easing with a corresponding rapid growth of central bank liabilities; de facto maintaining a plurality of their objectives, including ensuring financial stability and reducing unemployment; expanded participation of central banks in financing governments’ budget deficits. The measures taken helped to overcome the recession in developed countries and the transition to a trajectory of economic growth. The current practice of monetary policy normalization, initiated in the United States, involves a gradual increase in the key interest rate and a curtailment of central bank balances. However, in many developed countries, the practice of non-traditional monetary policy is still persistent and is an important factor for determining the trends of the global economy. In general, the results of this policy can be evaluated differently, but it is important for Ukraine to conclude on the relevance of monetary policy to stimulate economic development. Global volatility, increasingly determined by trade wars and other forms of protectionism in global economies, poses challenges (primarily in terms of maintaining/enhancing export and production capacity). For the economy of Ukraine, which is vulnerable to external shocks, these factors, combined with internal centres of instability, form a complex of complicated tasks, in particular in terms of the cessation of further loss of investment potential, which should be addressed rationally by the monetary policy instruments.

  1. Hummel, J. (2011). Ben Bernanke versus Milton Friedman. The Federal Reserve’s Emergence as the U.S. Economy’s Central Planner. The Independent Review, 15, 4, 485-518.

  2. Vishnevskii, V.P., Vishnevskaya, E.N., Matyushin, A.V., Sheludko, N.M. (2017). Monetary power in the modern world. Who will challenge the dollar? Kyiv: Akademperiodika [in Russian]

  3. DataBank. World Development Indicators. (2018). The World Bank. URL: ata/reports.aspx?source=world-development-indicators#

  4. Yurchushun, V. (2018). Forecasting scenario of economic development of Ukraine: limited pessimism. Kyiv: Zapovit. URL: [in Ukrainian]

  5. Yurchushun, V. (2019). Ukraine in a situation of changing elites: a socio-economic dimension. Kyiv: Razumkov tsentr. URL: [in Ukrainian]

  6. Mongelli, F.P. (2013). The mutating euro area crisis is the balance between ‘sceptics’ and ‘advocates’ shifting? European Central Bank, Occasional Paper Series, 144, February.

  7. Hess, C., Laforte, J., Reifschneider, D., Williams, J.C. (2012). Have We Underestimated the Likelihood and Severity of Zero Lower Bound Events? Journal of Money, Credit and Banking, 44, 47-82.

  8. Fuhrer, J.C., Olivei, J.P. (2011). The Estimated Macroeconomic Effects of the Federal Reserve’s Large-Scale Treasury Purchase Program. Federal Reserve Bank of Boston. Research Department Public Policy Briefs, 11-2. URL:

  9. Baumeister, C., Benati, L. (2010). Unconventional Monetary Policy and the Great Recession. Estimating the Impact of a Compression in the Yield Spread at the Zero Lower Bound. European Central Bank. Working Paper SERIES, 1258, October. URL:

  10. Kiley, M. (2012). The Aggregate Demand Effects of Short- and Long-Term Interest Rates. Finance and Economics Discussion Series.

  11. Yellen, J.L. (2013). A Painfully Slow Recovery for America’s Workers: Causes, Implications, and the Federal Reserve’s Response. A Trans-Atlantic Agenda for Shared Prosperity. A Conference Sponsored by the AFL-CIO, Friedrich Ebert Stiftung and the IMK Macroeconomic Policy Institute. Washington, D.C.

  12. Moody’s has named a possible cause of the next US crisis. URL: [in Ukrainian]

  13. Harkavenko, V.I., Shapoval, Yu.I. (2017). Mopping up banking sector in Ukraine: the value for society and state. Ukr. socìum – Ukrainian society, 1, 108-123 [in Ukrainian]

  14. Anufriieva, K.V., Shapoval, Yu.I. (2018). Verbal interventions of the central monetary authorities in the conditions of new normality: the benchmarks for the NBU. Ukr. socìum – Ukrainian society, 4, 127-142 [in Ukrainian]

  15. Closure of Chimerica. What will confrontation between the US and China lead to? (2018). Kommersant. URL: [in Russian]

  16. Global Economic Prospects: Darkening Skies: A World Bank Grope Rangship Report. (2019, January).

  17. Zymovets, V.V., Sheludko, N.M. (2017). Debt burden and investment disfunction in real sector of Ukraine. Ekon. promisl. – Economy of Industry, 3, 82-95 [in Ukrainian]

  18. Hirshfeld, A. (2019). On the Compensation Program and steps for its implementation. Propozytsiia, 2, 182-187.

Full text