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Author Question: Until the credit crunch and banking crisis, the Bank of England did not to use changes in the ... (Read 82 times)

tnt_battle

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Until the credit crunch and banking crisis, the Bank of England did not to use changes in the liquidity ratio to influence banks' behaviour because
◦ only banks that were members of the Bank of England were subject to reserve requirements, and most banks do not belong to the Bank of England.
◦ governments felt that banks should be free from such regulations in order to encourage profitable lending opportunities.
◦ a change in the liquidity ratio has only a very small impact on the money supply.
◦ it takes a long time for the Bank of England to approve a change in the liquidity ratio.


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Marked as best answer by tnt_battle on May 25, 2020

aburgess

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tnt_battle

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Reply 2 on: May 25, 2020
Excellent


helenmarkerine

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Reply 3 on: Yesterday
Thanks for the timely response, appreciate it

 

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