This unit provides undergraduate students with knowledge and a greater understanding of key theoretical and practical issues pertaining to the role of contemporary commercial banking in modern monetary economies. The unit embeds a strong policy-related element by extensively examining the important interactions that exist between contemporary commercial banking, domestic and international financial markets, and monetary policy implementation. The subject will cover features of the financial system, money and payments, commercial banks and the money supply process, the role of contemporary commercial banking in the monetary transmission mechanism and implementation of monetary policy goals, monetary policy rules (both theory and practice), the impact of monetary policy on asset prices and a discussion of alternative (non-traditional) monetary policy conducted at near zero interest rates (quantitative easing, QE, and policy guidance).
1x 2hr lecture and 1x 1hr tutorial per week
mid-semester exam (30%); tutorial exercises (10%); group project (20%); final exam (40%)
BANK2011 or ECOS2004 or FINC2011