THE IMPACT OF CURRENCY POLICY ON ECONOMIC GROWTH RATES
Keywords:
Currency policy, economic growth, Taylor Rule, monetary policy, inflation, interest rate, output gap, Uzbekistan, emerging markets, macroeconomic stabilityAbstract
This paper examines the relationship between currency policy and economic growth, with particular emphasis on the role of interest rate and exchange rate management in shaping macroeconomic outcomes. By applying the Taylor Rule framework to Uzbekistan’s economic data from 2021 to 2024, the study provides a dynamic assessment of how monetary authorities can respond to inflationary pressures and output gaps. The analysis highlights the importance of data-driven policy adjustments, showing that nominal interest rate recommendations ranged between 13.25% and 12.15% during the observed period. Real-world applications of the rule demonstrate its relevance for maintaining macroeconomic stability and supporting sustainable growth in emerging markets. The paper concludes that transparent and responsive currency policy, anchored in systematic models, is essential for enhancing economic resilience and long-term performance.
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