The Association of Multiple Banks of the Dominican Republic considered the monetary measures adopted by the Central Bank to be appropriate and timely, under the understanding that one of its main reasons is to control inflation.
In a press document, the ABA expressed that the accumulation of two relevant shocks such as the pandemic and Russia’s war with Ukraine has placed the world in an inflationary situation that has not occurred in recent decades, turning into a complex, volatile panorama. and uncertain.
In that order, he recalled that the Federal Reserve of the United States of America recently approved the largest increase in interest rates in 22 years to contain inflation and plans to continue raising it this year.
He explained that, in this global context, the economies are forced to try to control inflation, due to the damages that are derived both in people and in business activities. “Latin America and our country are not the exception. Most of the central banks in the region have made significant increases in their monetary policy rates, especially those that follow the inflation targeting model,” he added.
The union explained that, definitively, the transmission channel of this measure is verified through bank interest rates, both active and passive, which banks are obliged to adjust as these operations are renewed, always considering the particularities and characteristics of each activity.
He pointed out that the foregoing will always be in line with the monetary policy signals aimed at controlling inflation and the economy growing according to its potential, so that certainty can be preserved to successfully overcome this difficult international situation.
The ABA indicated that the banking sector is willing to continue supporting the productive sectors, including small and medium-sized companies in these new scenarios, where prudence, comprehensive risk management and support must prevail, so that credit continues to play a relevant role in the generation of wealth and employment.