This paper discusses how financial stability governance has evolved and how central banks and financial regulators are coping with the threats posed by climate uncertainty, providing an overview of G20 countries' green central banking experiences in the past 20 years. The analysis shows that...

This paper examines how monetary and macroprudential policies interact and possibly complement each other in achieving their respective price and financial stability objectives. We first review the Canadian experience of housing market cycles and highlight the need to coordinate the two sets of...

This paper explains the nature of interest rates in the U.S. federal funds market after the 2007-09 financial crisis. We build a model of the over-the-counter lending market that incorporates new aspects of the financial system: abundance of liquidity, different regulatory standards for banks,...

Central banks may engage in large-scale lending and asset purchases to stabilize financial markets and implement monetary policy during crises. The ability of these actions to restore financial market functioning is well documented; however, they come with costs. We provide a literature review of...

This paper evaluates the relationship between monetary and fiscal policy and the relative effectiveness of macroeconomic stabilization through the lens of Modern Money Theory (MMT). We articulate previously-neglected aspects of monetary sovereignty to offer a new interpretation of the Bernanke...

Central banks play a crucial role in promoting financial stability. They act as financial system stabilizers through their capacity to create liquidity and channel it to financial institutions and markets in times of stress - a role that has evolved and expanded substantially over the past 15...

In times of stress, if the potential demand from asset managers for market liquidity approaches or exceeds dealers' ability to intermediate, it could lead to a precautionary but disruptive dash for cash and may lead central banks to intervene. If the likelihood of such a dash for cash increases...

The theory and practice of central banking reflect a symbiotic relationship that has gradually evolved along with the financial system. An important milestone has been a heightened focus on financial stability and a greater appreciation of the importance of macro-prudential policy in central...