CEPR: Central banks stuck in interest rate trap
A paper published by the Centre for Economic Policy Research in August says central banks' efforts to stabilise financial markets forces economies to fall into a low interest rate trap.
Francesco Giavazzi and Alberto Giovannini, the paper's authors, argue that liquidity transformation in financial markets is unavoidable and an ever-present problem as policymakers will always attempt to minimise the occurrence of financial crises by preventing a breakdown in liquidity transformation.
However, the
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