Thats called a peg and it helps exporters keep their prices competitive. The disinflation route sometimes immolates economic growth and employment. Words Versus Deeds How Central Banks Manage Expectations Vox Cepr Policy Portal Central banks also regulate exchange rates as a way to control inflation. . The correct answer is option iv Reducing unemployment and stabilizing prices. Inflation is mainly caused either by demand Pull factors or Cost-Push factorsApart from demand and supply factors Inflation sometimes is also caused by structural bottlenecks and policies of the government and the central banks. Which best describes a central banks primary role. Conventional central banking practice is to increase the nominal interest rate target when. It is the amount of cash that should be held by each commercial bank. The primary role of the central bank is to create a monetary policy. The full extent of central