scholarly journals Excess Reserves and the Implementation of Monetary Policy of the ECB

2004 ◽  
Author(s):  
Ulrich Bindseil ◽  
Gonzalo Camba-Mendez ◽  
Astrid Hirsch ◽  
Benedict Weller
Keyword(s):  
Monetary Policy ◽  
Excess Reserves ◽  
Implementation Of Monetary Policy

scholarly journals Excess reserves and the implementation of monetary policy of the ECB

2006 ◽  
Vol 28 (5) ◽  
pp. 491-510 ◽  
Author(s):  
Ulrich Bindseil ◽  
Gonzalo Camba-Mendez ◽  
Astrid Hirsch ◽  
Benedict Weller
Keyword(s):  
Monetary Policy ◽  
Excess Reserves ◽  
Implementation Of Monetary Policy

scholarly journals MONETARY POLICY IMPLEMENTATION FRAMEWORKS: A COMPARATIVE ANALYSIS

2010 ◽  
Vol 15 (S1) ◽  
pp. 145-189 ◽  
Author(s):  
Antoine Martin ◽  
Cyril Monnet
Keyword(s):  
Monetary Policy ◽  
Comparative Analysis ◽  
Policy Implementation ◽  
Central Bank ◽  
Open Market ◽  
Implementation Framework ◽  
Friedman Rule ◽  
Excess Reserves ◽  
Implementation Of Monetary Policy

We compare two stylized frameworks for the implementation of monetary policy. The first framework relies only on standing facilities, whereas the second framework relies only on open-market operations. We show that the Friedman rule cannot be implemented when the central bank uses standing facilities only. For a given rate of inflation, we show that standing facilities unambiguously achieve higher welfare than just conducting open-market operations. We conclude that elements of both frameworks should be combined. Also, our results suggest that any monetary policy implementation framework should remunerate both required and excess reserves.

scholarly journals Management Of Banking System Liquidity In The Czech Republic

2011 ◽  
Vol 10 (1) ◽  
Author(s):  
Karel Bruna
Keyword(s):  
Monetary Policy ◽  
Interest Rates ◽  
Structural Changes ◽  
Banking System ◽  
Policy Instruments ◽  
The Czech Republic ◽  
Excess Reserves ◽  
Excess Liquidity ◽  
Volatility Analysis ◽  
Implementation Of Monetary Policy

Implementation of monetary policy assumes that monetary policy instruments stabilize O/N interest rates to the proximity of main policy rate to achieve monetary targets. The function of stabilizing mechanism is based on simple rule that the volume of liquidity in the banking system is held in line with the demand of banks for reserves. In this paper main factors of banking system liquidity are analyzed in the context of bank’s imperfect intertemporal substitution of reserves and with respect to predictibility of O/N interest rates volatility. Analysis of O/N PRIBOR and CZEONIA reference interest rates prove Czech National Bank’s ability to stabilise O/N interest rates disregard overall excess liquidity in the banking system. It also identified structural changes acting in the money market like reduced instability of demand for reserve and decreased volatility of O/N interest rates due to intdroduction of credit facility or increased volatility of the spread between O/N interest rates and repo rate due to reduction of frequency of repo tenders. Rapid increase in the volatility of differences between OMO target and bank’s supply of excess reserves is also resulting in the weakening of a direct relationship between O/N PRIBOR dynamics and repo tenders.

scholarly journals Effectiveness and Forecasting of Interest Rate Reversal BI 7-Day Repo Rate in Indonesia: Lower Bound on Monetary Policy?

2018 ◽  
Vol 9 (1) ◽  
pp. 171-180
Author(s):  
I Gede Sanica ◽  
I Ketut Nurcita ◽  
I Made Mastra ◽  
Desak Made Sukarnasih
Keyword(s):  
Monetary Policy ◽  
Interest Rate ◽  
Time Series Data ◽  
Moving Average ◽  
Series Data ◽  
Autoregressive Integrated Moving Average ◽  
Implementation Of Monetary Policy ◽  
Repo Rate ◽  
The Right ◽  
The Impact

AbstractThis study aims to analyze effectivity and forecast of interest rate BI 7-Day Repo Rate as policy reference in the implementation of monetary policy. The method was used in this study contains Vector Autoregression (VAR) to estimate effectivity of BI 7-Day Repo Rate and Autoregressive Integrated Moving Average (ARIMA) to forecast of BI 7-Day Repo Rate. Period of observation in this study used time series data during 2016.4 until 2017.6. The result of this research shows that the transformation of the BI Rate to BI 7-Day Repo Rate is the right step in the monetary policy operation in the effort to reach deepening of the financial market and strengthen the interbank money market structure so that it will decrease loan interest rate and encourage credit growth. The effectiveness of the use of BI 7 Day-Repo Rate on price stability is indicated by the positive relationship between the benchmark interest rate and inflation compared to the BI Rate. The impact of BI 7-Day Repo Rate on economic growth that tends to be positive. Forecasting the use of BI 7-Day Repo Rate shows good results with declining value levels, so this will encourage deepening the financial markets.

Monetary Policy, Accountability and Legitimacy: A Review of the Issues in Canada

1991 ◽  
Vol 24 (4) ◽  
pp. 711-734 ◽  
Author(s):  
William D. Coleman
Keyword(s):  
Monetary Policy ◽  
Business Community ◽  
Working Relationships ◽  
Policy Network ◽  
Democratic Accountability ◽  
Bank Of Canada ◽  
Governing System ◽  
Implementation Of Monetary Policy ◽  
The Government ◽  
The One

AbstractMonetary policy in Canada is formulated and implemented in a state-directed policy network dominated by the Bank of Canada. State-directed networks embody a tension between democratic accountability and legitimacy on the one side and maintaining support from the business community on the other. This article assesses this tension in Canadian monetary policy, focussing on the relationships between the Bank of Canada and other actors. As a central bank, the Bank of Canada possesses a unique constitutional status, being tied to the government through a directive power of the minister of finance. The Bank has also developed close working relationships with financial institutions for the implementation of monetary policy. In reviewing these relationships, the article identifies problems related to the Bank's political accountability and its ability to maintain legitimacy. The article then reviews some reforms that might address these problems: making the Bank more independent, subjecting it to closer control by the minister of finance and endowing it with a council-based internal governing system.

Prices may rise if lending picks up in major economies

2020 ◽  
Keyword(s):  
Monetary Policy ◽  
Stock Market ◽  
Crisis Response ◽  
Stock Market Volatility ◽  
Monetary Aggregate ◽  
Content Type ◽  
Excess Reserves ◽  
Central Bank Money ◽  
Pass Through ◽  
Bank Money

Significance Similar fears accompanied the 2008-09 anti-crisis response, but did not come true. The main reason is that, while quantitative easing and other measures boost the monetary base (M0), inflation is more likely to be fired by strong growth in the broadest monetary aggregate (M3); so far, there has been limited pass-through from M0 to M3. Impacts Central bank money supply is underwriting stock market gains, an intended monetary policy outcome; but stock market volatility is rising. If higher inflation does occur, central banks have the tools to control it; indeed, rising prices has been a central monetary policy goal. If inflationary pressures do appear, reducing the large volumes of banks’ excess reserves will require adroit management.

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