2. Managing Inflation and Economic Growth: By controlling inflation and stimulating economic growth via interest rate adjustments and other monetary policy tools, central banks foster a stable environment for capital markets.Â
3. Financial Market Regulation and Oversight: Ensuring the transparency, efficiency, and integrity of capital markets and implementing regulations to prevent market manipulation, fraud, and systemic risks.
*Financial intermediaries in capital market:
1. Investment Banks: Assist companies in raising capital by underwriting and selling securities, advising on mergers and acquisitions, and providing research and trading services.
2. Stockbrokers: Buy and sell securities on behalf of clients, providing investment advice and research.
3. Mutual Funds: Invest in a diversified portfolio of stocks, bonds, and other securities, offering individuals a way to pool their funds and invest in the capital market.
4. Hedge Funds: Invest in a variety of assets, using leverage and complex strategies to generate returns for high-net-worth individuals and institutional investors.
5. Venture Capital Firms: Provide financing to start-ups and early-stage companies in exchange for equity.
6. Private Equity Firms: Invest in established companies, often with the goal of eventually taking the company public or selling it for a profit.
*Technological innovation in money and capital market:
Technological innovation has been transforming the money and capital markets in recent years, bringing about significant changes in how financial transactions are conducted, investments are made, and risks are managed. Here are some key developments:
