So, as I said at the start, the central bank may have to be vigilant that the pace of asset reduction by banks is commensurate with an evolution of income, activity and employment that does not create downside risks to price stability.
But this policy strategy may be difficult to pursue in a situation in which banks’ propensity to absorb central bank liquidity is muted. 2. The short-term crisis response  Does this mean that, in the dark-grey zone of intersection between the two cycles, policy is left impotent? The answer is: absolutely no.