The Role of Central Banks and the Interbank Market in Managing Bank Liquidity During the Global Financial Crisis
Chiaramonte investigates the role of central banks and the interbank market in managing banking liquidity during the global financial crisis (GFC). Focusing on the link between monetary policy and liquidity management, the chapter analyzes the operating framework for the three main central banks involved in the crisis (the ECB, FED and Bank of England) and the exceptional instruments used to deal with the crisis. The author reviews the main theoretical contributions related to the role of the interbank market in the transmission of financial crises, and the functioning of this market during the GFC.
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