The effectiveness of Bank of Algeria in controlling the excess liquidity pdf

during the period (2001-2015)

Nasreddine ENNEMRI (*)   

Faculty of Economic , Commercial and Management Sciences

Ahmed Bougara dit Si Mhamed University, Boumerdes; Algeria

Abstract:This study aimed to investigate the effectiveness of bank of Algeria in controlling the excess liquidity, in order to determine whether this bank kept a good coordination between the value of foreign exchange reserves and the amount of its monetary reserves. In fact, the study used correlation and multiple regression analysis as statistical tools. These tools are very important to verify whether the monetary reserves participated in reducing the excess liquidity. The study concluded that the local and the foreign monetary reserves available at the bank of Algeria were among the main factors affecting the excess of liquidity and the inflation. Also, they constitute a financial resource, for the Algerian government, to finance its public expenditure in the near future.

Keywords:Bank of Algeria, Excess Liquidity, Foreign Exchange Reserve, Inflation.

Jel Classification Codes : G22, E52.