Arbeitspapier
Exit strategies for monetary policy
In response to the financial crisis of 2007/08, all major central banks decreased interest rates to historically low levels and created large excess reserves. Central bankers and academics currently discuss how to implement monetary policy, going forward. We find that paying interest on reserves (IOR) is optimal if the central bank has full fiscal support. If the central bank has no fiscal support, reducing reserves is optimal. This can be achieved by reserve-absorbing operations which hold the size of the balance sheet constant, or by selling assets which reduces the size of the balance sheet.
- Language
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Englisch
- Bibliographic citation
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Series: Working Paper ; No. 241
- Classification
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Wirtschaft
Money and Interest Rates: General
Monetary Policy, Central Banking, and the Supply of Money and Credit: General
Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
- Subject
-
Exit strategies
money market
repo
monetary policy
interest rates
- Event
-
Geistige Schöpfung
- (who)
-
Berentsen, Aleksander
Kraenzlin, Sébastien
Müller, Benjamin
- Event
-
Veröffentlichung
- (who)
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University of Zurich, Department of Economics
- (where)
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Zurich
- (when)
-
2018
- Handle
- Last update
-
10.03.2025, 11:46 AM CET
Data provider
This object is provided by:
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
Object type
- Arbeitspapier
Associated
- Berentsen, Aleksander
- Kraenzlin, Sébastien
- Müller, Benjamin
- University of Zurich, Department of Economics
Time of origin
- 2018
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