ABSTRACT
Because Uganda has had an underdeveloped financial system and a fairly substantial public sector, the scope for monetary policy evolution has been limited. However, with ongoing financial sector deregulation and accompanying structural reforms, an increasing use of indirect instruments in the conduct of monetary policy, and declining public-sector involvement, financial deepening is taking place. In this paper we ask: ‘What operational, intermediate, and final (domestic) targets of monetary policy would be the most suitable for the developing economic environment of Uganda?’
