The Swiss National Bank (SNB) has announced it will refrain from profit distribution in 2022 owing to the accumulation of a huge financial loss. In this paper we examine key determinants of the SNB's loss and shed light on its implications to monetary policy pursuit. In particular, we show that...

This study examines the problem that a central bank may face after exiting a monetary quantitative easing policy. It develops a simple dynamic optimization model of a central bank, which finds that if the bank needs to absorb a substantial amount of excess reserves when exiting, the monetary...

In this ever-changing environment of technological innovations central banks are strongly committed to fulfilling their key objectives of preserving monetary and financial stability, but also make efforts to adapt to new market requirements. On the path of technological transformation of...

The concept of the natural rate of interest, or r*, has risen to prominence in monetary policy following the Great Financial Crisis. No doubt a key reason for the concept's newfound prominence has been the further decline of real and nominal interest rates to new lows, which has further...