European Parliament Library

Banks’ Reserve Management, Transaction Costs, and the Timing of Federal Reserve Intervention, Giuseppe Bertola, Leonardo Bartolini, Alessandro Prati

Label
Banks’ Reserve Management, Transaction Costs, and the Timing of Federal Reserve Intervention, Giuseppe Bertola, Leonardo Bartolini, Alessandro Prati
Language
eng
Abstract
We use daily data on bank reserves and overnight interest rates to document a striking pattern in the high-frequency behavior of the U.S. market for federal funds: depository institutions tend to hold more reserves during the last few days of each “reserve maintenance period,” when the opportunity cost of holding reserves is typically highest. We then propose and analyze a model of the federal funds market where uncertain liquidity flows and transaction costs induce banks to delay trading and to bid up interest rates at the end of each maintenance period
resource.governmentPublication
international or intergovernmental publication
Literary Form
non fiction
Main title
Banks’ Reserve Management, Transaction Costs, and the Timing of Federal Reserve Intervention
Nature of contents
dictionaries
Responsibility statement
Giuseppe Bertola, Leonardo Bartolini, Alessandro Prati
Series statement
IMF Working Papers
Content
Other version