Tag: InterestRatePolicy

Monetary Policy and Islamic Banks: A Critical Literature Review

The authors conclude that more research is needed to fully understand the relationship between monetary policy and Islamic banking. They emphasize the importance of considering factors like the structure of Islamic banks’ balance sheets and the influence of profit-and-loss sharing in deposits and financing. The authors note that the existing research has a lack of theoretical grounding. Most studies focus on whether monetary policy influences Islamic banks, but they do not investigate why this happens. The authors suggest that the theory of Islamic finance could offer explanations.

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