Public should be allowed to open accounts with central banks – research

The St Louis Fed
The St Louis Fed
Matthew Black/Flickr

There is a “large unmet” demand for a liquid asset which would allow households and firms to save money outside the private sector, a problem which could be solved by central banks, according to new research.

Aleksander Berentsen and Fabian Schar make the case in their paper, published by the Federal Reserve Bank of St Louis.

“Central banks could offer such an asset by simply allowing households and firms to open accounts with them,” the authors argue.

Some might argue a central bank digital

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