Transmission of Monetary Policy Feds Lift-off and Collateral Reuse

By: Manmohan Singh

collateral-plumbing-book

This article was first published as a chapter in Collateral and Financial Plumbing (2nd Impression) on 7 September 2016 by Risk Books

Introduction

Many recent studies focus on the tools available to the Federal Reserve (Fed) for lift-off, ie, the gradual increase in its policy rate after several years of keeping it at zero (eg, Frost et al 2015). Some studies and policymakers link the lift-off issues with financial stability elements where they allude to the academic literature on the need f