Section 6 of the Central Bank of Cyprus Law confers following functions upon the bank.
In recent times, the Central Bank of Cyprus has intensified its efforts to liberalize the financial sector of the country.
With this objective in mind, the central bank has adopted a new monetary policy framework since 1996. The liquid asset ratio, the main instrument of monetary policy, has therefore been discarded. The abolition of the statutory interest rate ceiling on 1 January 2001 has been a cornerstone in the liberalization process of the financial sector. The Central Bank is also acting vigorously to regulate the banking system in the country and ensure its stability.