About the monetary policy

According to the article 4 of the central bank act no.54/2012, the primary objective of the central bank is to achieve and maintain the domestic price stability.

Achieving such objective is not possible in the absence of stability in the value of national currency.

There fore the CBSL have developed  a 5 year strategic plan (2018 -2022) that will strengthen the monetary policy department to strictly monitor the exchange rate behavior and intervenes in the market under the managed floating exchange rate regime to minimize the impacts of sharp exchange rate volatility on the level of commodity prices as well as other macro-economic indicators.

Since Somaliland is small open dual currency economy with a long-lasting trade deficit, these the exchange rate volatility impacts the domestic price stability.

There for the CBSL will monitor the exchange rate behavior and maintains the managed floating exchange rate regime to harmonize monetary and exchange rate policies.

The Bank plays a vital role in maintaining this confidense through its monetary stability objective.

 

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