Econometric Models of Monetary Policy Effectiveness in Ukraine

Abstract

The main task for the Central Bank is ensuring the stability of the national currency. For this purpose, it tends to use traditional monetary regulation instruments. There are interest rates regulation, currencies intervention, administrative restriction, money supply adjustment and so on. A significant number of these traditional tools are effective. However, it is very difficult to assess the effectiveness of the regulators influence. Therefore, the purpose of the work is to define the theoretical substantiation of the basic monetary regulation instruments effectiveness and estimate its influence on the economy growth indicators in Ukraine. This article is based on the theoretical principles and methods of macroeconomic analysis; the system approach methods to define the main monetary regulation instruments of finance system and economy. The study presents a regression models with paired and multiple variables. For these models R-Studio instruments are the main tools of quality estimation and results interpretation. The article shows the results of statistical analysis of national currency rate and consumer price index which is based on open data of Ukraine economy trends for the period from 2007 till 2019. Traditionally econometric methods are used to find out long run relationships between basic economy indicators (agriculture and industry outputs, average salary, stock index growth etc.) and both monetary information and regulation instruments. Authors develop the regressive models of influence of Central Bank regulation instruments of monetary and economic stability. The paper presents conclusions regarding trends and problems in the implementation of Ukraine's monetary policy, it's influences on the currency stability and economic growth trends. Implementation of the proposed measures will increase monetary policy effectiveness and define the directions of the further research in forecasting inflationary and course-forming factors of the development of the national economy and financial system of Ukraine. The key focus of further research is to define an adequate indicator that determines the real level of inflation, which must evaluate a whole range of factors reducing the real value of money.

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