Collateral and Monetary Policy
Electronic Access:
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Summary:
Financial lubrication in markets is indifferent to margin posting via money or collateral; the relative price(s) of money and collateral matter. Some central banks are now a major player in the collateral markets. Analogous to a coiled spring, the larger the quantitative easing (QE) efforts, the longer the central banks will impact the collateral market and associated repo rate. This may have monetary policy and financial stability implications since the repo rates map the financial landscape that straddles the bank/nonbank nexus.
Series:
Working Paper No. 2013/186
Subject:
Banking Central bank policy rate Collateral Financial institutions Financial services Financial statements Monetary policy Public financial management (PFM) Repo rates Unconventional monetary policies
English
Publication Date:
August 28, 2013
ISBN/ISSN:
9781484384916/1018-5941
Stock No:
WPIEA2013186
Pages:
17
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