Policy Briefs

F. Papadia: UNTIL WHEN WILL THE US AND THE EURO-AREA BE AWASH WITH CENTRAL BANK LIQUIDITY?

If you are patient, my tentative answer to the question in the title is: 2022 for the US and 2028 for the Euro-area, meaning that we can expect another 6 years of abundant central bank liquidity1) in the US and a dozen years in the Euro-area. If you bear with me a while longer, I can explain how I reach this, I believe surprising, result, and why it matters.

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