Should Unconventional Balance Sheet Policies Be Added to the Central Bank toolkit? a Review of the Experience so Far

Kotaro Ishi, Kenji Fujita and Mark Stone

No 2011/145, IMF Working Papers from International Monetary Fund

Abstract: What is the case for adding the unconventional balance sheet policies used by major central banks since 2007 to the standard policy toolkit? The record so far suggests that the new liquidity providing policies in support of financial stability generally warrant inclusion. As the balance sheet policies aimed at macroeconomic stability were used only by a small number of highly credible central banks facing a lower bound constraint on conventional interest rate policy, they are not relevant for most central banks or states of the world. Best practices of these policies are documented in this paper.

Keywords: WP; balance sheet; liquidity provision; bond purchase; liquidity support; credit market; support policy; Monetary policy; crisis policies; balance sheet policy; Financial statements; Liquidity; Central bank balance sheet; Bonds; Global (search for similar items in EconPapers)
Pages: 70
Date: 2011-06-01
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Citations: View citations in EconPapers (46)

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