Financial Stability News

Flashing news about financial stability and central banking

IOR caps: a new instrument of monetary policy?

This finance blogger has an interesting discussion of the Modern Money Theory, and then goes on to recommend caps on reserve interest rates as a way of getting bank reserves to those (small) banks that would need them most. Interestingly, this policy has already been initiated by some European central banks, including Norges Bank. For details, see here.

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