Why engaging in commercial businesses is taboo for central banks

October 7, 2013 
John Exter to the Central Bank: Don’t engage in commercial businesses

The father of the Sri Lanka’s Central Bank, John Exter, was emphatic on one point when he drafted the Monetary Law Act or MLA, the legislation under which the Central Bank has been established. Going by the traditional central banking principles, in the General Section of the Exter Report, he prohibited the Central Bank to engage in commercial businesses. This prohibition has got into the MLA as Section 117 of the Act in the form of three separate sub sections exactly as recommended by Exter.

Why Engaging in Commercial Businesses is Taboo for Central Banks by nelvely