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Excess reserves and monetary policy tightening

Fricke, Daniel; Greppmair, Stefan; Paludkiewicz, Karol - 2024 - This draft: February 2, 2024

We show that the transmission of the European Central Bank’s (ECB) recent monetary policy tightening differs across banks depending on their level of excess reserves. Specifically, the net worth of reserve-rich banks may display a boost when the interest rate paid on reserves increases...

Persistent link: https://www.econbiz.de/10014481115

Excess liquidity in the euro area : sources and remedies

Dąbrowski, Marek - 2023

The excess liquidity in the euro area is a product of a long period of quantitative easing. It changed the operational … system (ARS). To eliminate excess liquidity and return to the SRS, the ECB must intensify quantitative tightening, which is …

Persistent link: https://www.econbiz.de/10014491928

Quantitative or qualitative forward guidance : does it matter?

Detmers, Gunda Alexandra; Karagedikli, Özer; Moessner, … - 2018

Every monetary policy decision by the Reserve Bank of New Zealand (RBNZ) is accompanied by a written statement about the state of the economy and the policy outlook, but only every second decision by a published interest rate forecast. We exploit this difference to study the relative influences...

Persistent link: https://www.econbiz.de/10011926064

ECB monetary operations and the interbank repo market

Dunne, Peter G.; Fleming, Michael J.; Zholos, Andrey - 2013

We examine the relationship between monetary policy operations and interbank borrowing and lending of funds using sovereign bonds as collateral. We first establish that, in the precrisis period, there are important but rather weak relations between these funding sources and that this...

Persistent link: https://www.econbiz.de/10010222894

Market discipline and liquidity risk : evidence from the interbank funds market

Sarmiento, Miguel - 2016

demand for liquidity in the interbank market as wells as banks' access to this market. Results indicate that riskier banks … pay higher prices and borrow less liquidity, concurrent with the existence of market discipline. More capitalized and … higher prices and hoard liquidity when liquidity positions across them are more imbalanced and during a monetary policy …

Persistent link: https://www.econbiz.de/10011554714

The impact of exogenous liquidity shocks on banks funding costs : microevidence from the unsecured interbank market

Sarmiento, Miguel - 2019 - second version: January 2019

This paper examines the impact of exogenous liquidity shocks in the unsecured interbank market. We evaluate the effects … of idiosyncratic liquidity shocks - arising from deposits outflow at the bank level - and of the aggregate liquidity … shock related to the U.S. tapering observed between May and September of 2013. We find that both liquidity shocks are …

Persistent link: https://www.econbiz.de/10011958312

Scarce, abundant, or ample? : a time-varying model of the reserve demand curve

Afonso, Gara; Giannone, Domenico; La Spada, Gabriele; … - 2022

approach to address endogeneity. Consistent with economic theory, our estimates show a nonlinear demand function that exhibits …

Persistent link: https://www.econbiz.de/10013257201

The macro view

Balling, Morten (ed.); Berk, Jan Marc (ed.); … - Colloquium The Quest for Stability <2009, Utrecht>; … - 2010

On September 3-4, 2009, SUERF and Utrecht University School of Economics jointly organized the 28th SUERF Colloquium on "The Quest for Stability" in Utrecht, the Netherlands. The papers contained in this SUERF Study jointly published with DNB and Rabobank are based on contributions to this...

Persistent link: https://www.econbiz.de/10011706504

Money in monetary policy design: Monetary cross-checking in the New-Keynesian model

Wieland, Volker; Beck, Günter W. - 2010

In the New-Keynesian model, optimal interest rate policy under uncertainty is formulated without reference to monetary aggregates as long as certain standard assumptions on the distributions of unobservables are satisfied. The model has been criticized for failing to explain common trends in...

Persistent link: https://www.econbiz.de/10011605237

Financial stability considerations for monetary policy : theoretical mechanisms

Ajello, Andrea; Boyarchenko, Nina; Gourio, François; … - 2022

This paper reviews the theoretical literature at the intersection of macroeconomics and finance to draw lessons on the connection between vulnerabilities in the financial system and the macroeconomy, and on how monetary policy affects that connection. This literature finds that financial...

Persistent link: https://www.econbiz.de/10012819348