At its meetings on the 3rd and 5th of April 2013, the Monetary Policy Committee (MPC) of the Bank of Mongolia decided to cut the policy interest rate by 1.0 percentage point to 11.5 percent for the purpose of increasing domestic credits and investments, supporting the real sector and stimulating business activities.
Expected low impact of the government budget on inflation, decline in demand-pull and supply driven inflationary pressure, and annual inflation outlook in upcoming months to be consistent with the targeted level have enabled to reduce the policy interest rate.
The MPC obviously has made the decision concerning prolonged uncertainties in foreign investment environment and foreign trade.
Now that the BOM has been taking measures to stimulate economy, some investors are starting to worry about healthiness of financial system and some major banks.
This report is to answer some of the questions below.
- What are the policies taken by BOM to achieve “Growth” of the economy?
- Are Mongolian banks still healthy? (Highlights of financial statements of major banks as of end of 2012)
- How much will be the current valuation of Mongolian banks? Will it be possible for them to do IPO in foreign stock exchanges?
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