Direct pass-through effects The first is by addressing impairments in financial markets that have a direct pass-through effect to the real economy. And this effect will naturally be stronger in those markets that are more important for the transmission of monetary policy.
With this in mind, we began our shift to actively deploying our balance sheet by focusing on the ABS market, as this was a market that was both impaired and that had a tight link with bank lending, which is the main transmission mechanism of monetary policy in the euro area.