Challenges to central banking from globalized financial systems papers presented at the ninth conference on central banking washington dc september 16 17 2002 editors piero c ugolini andrea schaechter and mark r stone. The objective of the conference was to assess new challenges to central banking posed by the globalization of financial systems in industrial and emerging market economies globalization has produced larger faster moving and more integrated financial markets and systems central banks are now grappling with new and difficult policy challenges generated by this more dynamic financial environment. This lack of a single unifying policy objective and the less developed financial systems create unique monetary policy challenges for itl central banks the limited menu of targets and instruments complicates monetary operations exchange rate policies must contend with the unclear role of the exchange rate in the monetary framework. Increasing global financial market integration is presenting new challenges to central banks as they seek to attain low inflation and financial stability this volume is based on a conference hosted by the imf in september 2002 it examines key issues such as the choice of nominal anchor for countries susceptible to shifts in capital flows what can be done to prevent and deal decisively with