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Should There Be Intraday Money Markets?

  • ANTOINE MARTIN
  • JAMES McANDREWS

"In this article, we consider the case for an intraday market for reserves. We discuss the separate roles of intraday and overnight reserves and argue that an intraday market could be organized in the same way as the overnight market. We present arguments in favor of and against a market for intraday reserves when the marginal cost of overnight reserves is positive. We also consider how reserves should be supplied when the cost of overnight reserves is zero. In that case, the distinction between overnight and intraday reserves becomes blurred, raising an important question: What is the role of the overnight market?"("JEL" E44, E58) Copyright (c) 2009 Western Economic Association International.

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Article provided by Western Economic Association International in its journal Contemporary Economic Policy.

Volume (Year): 28 (2010)
Issue (Month): 1 (01)
Pages: 110-122

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Handle: RePEc:bla:coecpo:v:28:y:2010:i:1:p:110-122
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  1. Green, Edward-J, 1997. "Money and Debt in the Structure of Payments," Monetary and Economic Studies, Institute for Monetary and Economic Studies, Bank of Japan, vol. 15(1), pages 63-87, May.
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