Iqtisodiyotni raqamlashtirish sharoitida buxgalteriya hisobi, iqtisodiy tahlil va auditni xalqaro standartlar asosida rivojlantirish muammolari va istiqbollari

293 
WAYS OF EFFECTIVE IMPLEMENTATION OF MONETARY POLICY IN 
OUR COUNTRY 
Karshi Engineering and Economic Institute 
Rashidov Raximjon Iskandarovich
Senior Lecturer 
Karshi Engineering and Economic Institute Student

Bahodirov Azamat Mirsaid o‘g‘li 
Karshi Engineering and Economic Institute Student
Abdiraxmonov Anvarbek Akbar o’g’li 
Introduction 
In accordance with the Law on the Central Bank of the Republic of Uzbekistan, 
the strategic objectives of the Central Bank are the fight against inflation, ensuring the 
stability of the banking system and payment systems [1]. To achieve this strategic 
goal, the inflation target and the growth rate of money supply are being used as 
tactical goals of monetary policy.
At present, there are pressing issues related to the improvement of monetary 
policy in the country. Current problems include the growth rate of money supply and 
the high rate of devaluation of the national currency, the low level of money supply 
to the economy, the relatively high interest rates on loans of commercial banks in the 
national currency.
In turn, finding scientifically sound solutions to current problems related to the 
improvement of monetary policy makes it necessary to study the provisions of 
leading monetary concepts and assess their practical significance.
The founder of the monetary concept of monetarism is M.Friedman, a 
professor at the University of Chicago in the United States and a Nobel laureate.
M.Friedman was the first in the economic literature to scientifically 
substantiate the need to set the annual growth of the money supply as a firm
indicator and make the process of achieving it the object of control by the 
Central Bank. He concluded that the growth of the money supply should be based on 
the steady growth of the price of the final product over a long period of time [2].

294 
J.Keynes believes that the interest rate plays an important role in the monetary 
concept and that it can have a direct impact on unemployment and economic growth 
by influencing interest rates.
The transmission mechanism of monetary policy proposed by J.Keynes consists 
of three stages:
*
first stage: money supply - interest rate;
*
second stage: money supply - interest rate - investment;
*
third stage: money supply - interest rate - investment - national income [3].
According to J.Keynes’s transmission mechanism, firms and firms increase 
their planned investments as interest rates fall, this results in an unforeseen 
consumption of inventories, combined with the total amount of planned expenditures, 
and firms and companies will increase production under such conditions, as a result, 
national income will increase.
According to F.Mishkin, the open market operations of the Central Bank have 
the following advantages:
-
open market operations are carried out at the initiative of the FZT and its 
volume is controlled by the FZT, there is no such control in the implementation of 
discount operations; 
-
high level of flexibility of open market operations, their volume can be 
changed at any time; 
-
open market operations have an easy reversibility content, and if the FZT 
made a mistake in carrying out these operations, it can quickly cancel the operation[4]. 
J.Taylor's monetary rule allows the Central Bank to determine the possibility of 
changing interest rates in response to changes in prices and fluctuations in real output 
relative to its equilibrium level, and it has a stabilizing property, ie minimizing 
cyclical fluctuations in the economy [5]. However, practice has shown that the Taylor 
rule has certain drawbacks. In particular, GEP inflation indicators and GDP 
information may not fully cover economic variables. Because there are other 
important indicators such as monetary aggregates, credit multiplier, exchange rate, 
budget deficit, it is impossible to ignore them for in- depth analysis.

295 
According to McCallum, a factor complicating the use of money balances as 
an instrument of monetary policy is the instability of demand for money. This is 
partly explained by the fact that central banks prefer to use interest rates as an 
instrument of monetary policy [6].
T.Bobakulov's conclusion that the growth rate of the monetary aggregate M2 
should be chosen as an
indicator of monetary policy of the Central Bank of the Republic is based on 
the following facts:
-
The existence of a legal framework for the use of money supply growth as an 
indicator of monetary policy; 
-
The existence of a direct link between cash circulation and economic activity 
in the country; 
-
The ability of the central bank to directly influence the money supply through 
the monetary base; 
-
The leading factor in the structure of inflation is the weight of non-monetary 
factors, the fact that the basic inflation rate is not used in the process of inflation 
targeting [7]. 
According to the new Law on the Central Bank of the Republic of Uzbekistan, 
the strategic goals of the Central Bank's monetary policy are to fight inflation, ensure 
the stability of the country's banking system and payment systems, while inflation 
targets and money supply growth rates are tactical goals of monetary policy [1].
Induction and deduction, trend analysis and expert evaluation methods were 
used in conducting the research.
The continuing devaluation of the national currency in the Republic of 
Uzbekistan, the relatively high level of inflation, the high level of money supply to the 
economy are important factors to consider in assessing the practical significance of 
monetary concepts.
A number of provisions of the leading monetary concepts have been put into 
practice. In particular, the principle of controlling the growth rate of the money supply 
of the monetary concept of monetarism is used as a tactical goal of monetary policy in 

296 
many countries around the world [8; 9; 10; 11].
In Germany and France, since the 1970s, the practice of controlling the growth 
rate of the money supply by the Central Bank has been introduced. In the United States, 
Congress passed a law in 1978 that mandated the Federal Reserve to control the 
growth of the money supply.
The results of the monetary policy of the United States, Japan and France to 
limit the growth rate of money supply showed that this measure will ultimately lead 
to a decrease in production rates, a reduction in supply of goods and services, but 
price stability will be achieved.
M.Friedman's scientific conclusion that the change in the money supply is not 
due to changes in the economic situation has not been proven in practice. The 
economic crisis in Southeast Asia in 1997-1998 and the global financial and 
economic crisis that began in 2008 showed a direct link between the volume of money 
supply and changes in the economic situation.
According to M.Friedman's theory of monetarism, the demand for money does 
not decrease in proportion to the growth of cash balances and nominal income, but 
remains unchanged. Because every change in the money supply affects not only the 
level of investment, but also the volume of personal consumption. The volume of 
personal consumption, in turn, varies in proportion to the dynamics of nominal 
income. As a result, the demand for money remains constant for each individual 
period received, while the money supply fluctuates constantly. This conclusion has 
been proven in the practice of many countries around the world [12; 13; 14].
It should be noted that J.Keynes's rule on the mechanism of transmission of 
monetary policy is important for the practice of the Republic of Uzbekistan. This is 
due to the fact that the current high interest rates on loans from commercial banks in 
the Republic of Uzbekistan hinder the expansion of access to credit for companies and 
firms. This is because interest rates are the price of loans. The higher the interest rates 
on loans, the lower the chances of individuals and legal entities to use them. 

297 

Download 8,84 Mb.