Central Bank Roles, Objectives, and Core Functions Explained
Central Bank Prosecutor & Auditor General Roles
The Prosecutor serves as the supreme head of the Prosecutor's Office and its staff. Their responsibilities include:
- Ensuring that agreements, resolutions, and contracts of the Bank conform to current legal standards;
- Reporting on legal matters submitted for consideration and generally advising the Council on issues requiring legal assessment;
- Monitoring the progress of trials in which the Bank is a party; and
- Performing any other functions and powers assigned by the Council.
The Auditor General is responsible for the inspection and internal audit of the Bank's accounts, transactions, and administrative procedures. The Auditor General shall communicate in writing to the President, with copies to the Council, any observations deemed appropriate regarding the Bank's accounts and operations.
Central Bank Objective: Ensuring Currency Stability
This objective means preventing the currency's value from deteriorating due to price inflation, thereby ensuring the currency does not lose its purchasing power.
Central Bank Objective: Domestic Payment Systems
The domestic payment system comprises the institutions and instruments that facilitate economic transactions. Key instruments include currency in circulation and bank deposits (e.g., checking accounts). A flaw in the operation of these instruments can severely impact the entire payment system, causing significant economic damage.
Central Bank Objective: External Payment Systems
This objective aims to prevent balance of payments crises that could disrupt foreign exchange transactions, such as payments for imports, returns on exports, remittances, and other international financial operations.
Key Functions of the Central Bank
Issuance of Currency
The Central Bank holds the exclusive authority to issue banknotes and coins. These banknotes and coins are the sole legal tender throughout the country, possessing unlimited legal tender status and facilitating all transactions.
Statistical Functions
The Central Bank is mandated to promptly publish key national macroeconomic statistics. This includes data related to monetary policy, exchange rates, balance of payments, and national accounts.
Role as Fiscal Agent
Upon request from the Minister of Finance, the Central Bank may act as a fiscal agent. This role involves assisting in the procurement of external and internal loans and engaging in other operations compatible with the institution's objectives.