Analyzing alternative intraday credit policies in real-time gross settlement systems
This paper examines a central bank's choice of intraday credit policy for Real-Time Gross Settlement (RTGS) systems. Formal analysis of central bank objectives and commercial bank payment activity provides insight into both the choice and effects of several possible intraday credit policies. Observed intraday credit policies are interpreted within the context of the model. Among G-10 central banks, different combinations of prices, collateral, and quantity limits have been chosen to manage the supply of intraday credit. Conditions that rationalize these choices are shown to rely on a) central bank preferences regarding credit risk and systemic risk, b) liquidity management technologies, and c) the cost of collateral.
|Date of creation:||1997|
|Contact details of provider:|| Postal: 20th Street and Constitution Avenue, NW, Washington, DC 20551|
Web page: http://www.federalreserve.gov/
More information through EDIRC
|Order Information:||Web: http://www.federalreserve.gov/pubs/feds/fedsorder.html|
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Van Hoose, David D., 1991. "Bank behavior, interest rate determination, and monetary policy in a financial system with an intraday federal funds market," Journal of Banking & Finance, Elsevier, vol. 15(2), pages 343-365, April.
- Giannini,C. & Monticelli,C., 1995. "Which Target for Monetary Policy in Stage Three? Issues in the Shaping of the European Payment System," Papers 257, Banca Italia - Servizio di Studi.
- Angelini, P. & Giannini, C., 1993. "On the Economics of Interbank Payment Systems," Papers 193, Banca Italia - Servizio di Studi.
When requesting a correction, please mention this item's handle: RePEc:fip:fedgfe:1997-40. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Franz Osorio)
If references are entirely missing, you can add them using this form.