In response to COVID-19 and its economic fallout, central banks have deployed “unconventional” monetary policy tools. Some countries have more leeway to do so than others, given their position in the global economy. Monetary policy measures can provide additional resources to governments, lower the cost of borrowing, and manage financial integration in a more equitable manner.
Monetary policy decisions have distributional consequences that will affect social inequalities and people’s rights. Central banks should use the tools at their disposal to provide substantial resources to governments and to the businesses and households most at risk from the economic fallout of COVID-19.