International experience for war-time monetary policy: lessons for Ukraine

Abstract

Monetary policy directly acts as a significant element of national security. Rather than merely influencing economic security, it is relevant in broader terms as its results indirectly affect the social, ecological and other aspects of societal existence. The paper considers the examples of monetary policy implemented in war-time of different eras based on the existing system of monetary management (Bretton Woods, post-Bretton Woods, inflation targeting, floating exchange rate, etc.). Focus is placed on the changing principles of monetary policy during the war waged by Russia against Ukraine. On the one hand, Russia’s monetary policy has returned to the administrative practices of the USSR and has practically suspended conversion of the ruble. On the other hand, Ukraine has employed limited administrative restrictions as the National Bank of Ukraine tries to uphold the main principles of market economy. The author concludes that despite the reoccurrence of some key approaches, in general, the international experience indicates the absence of any particular standards of war-time monetary policy. Therefore, evidently in such conditions it is more reasonable to develop an individual approach to monetary policy that takes into account the experience of other countries in one way or another.