The role of central banks went through significant changes following Global Financial Crisis, said former Bangladesh Bank (BB) governor Dr Atiur Rahman at a seminar in the US on Tuesday.
The Brexit and the advent of Trump era further accentuated global uncertainty with serious implications for central banking, he added.
Some central banks in emerging markets (EMs) like Brazil, India, South Africa, Indonesia and Turkey were at the centre of the EMs' turmoil, he said.
Yet, a few central banks, particularly the BB, opted for developmental central banking without compromising on its macro-prudential role and exhibited great financial and economic stability, he added.
The coordinating role of the BB with its motivational focus on socially responsible financing led to this desired outcome. It combined short-term business cycle fluctuation management with long-term sustainable agenda, said Dr. Atiur.
He, however, observed that a central bank of tomorrow will need to manage policies in a globalised world, become more transparent and sensitive, position itself as a knowledge institute and widen and deepen financial inclusion.
Dr Atiur was delivering his keynote address on "The changing role of a central bank in an uncertain world" at the Annual Symposium of Academy of International Business-US North East Chapter. It was organised jointly by Quinnipiac University, Dhaka University and Sacred Heart University at the Quinnipiac University, Connecticut, USA.
Professor Mathew O' Connor, Dean, School of Business, Professor Mark Thomson, Provost of Quinnipiac University, and Professor Shibli Rubayatul Islam, Dean of School of Business, Dhaka University, also were present on the occasion.
In his keynote speech, Dr. Atiur said the global economic slowdown still continued and confidence remained fragile despite some gains in the US economy.
The central banks of the advanced economies became 'fire fighters' following Global Financial Crisis, he mentioned.
"The unprecedented 'Quantitative Expansions' led to huge capital inflows to Emerging Markets which tends to be reversed at the slightest hint of raising rate of interest in the advanced economies," said the former BB governor.