To what extent are we permitted to outsource public law tasks to private entities? And what would be the appropriate extent of supervision over such entities? Alternatively, a retail CBDC could be based on deposit accounts with the central bank. Though involving vast numbers of accounts, it would not be a particularly innovative option from a technological viewpoint.
So, the anchoring of rate expectations is reinforced by asset purchases. And, conversely, the net stimulus provided by asset purchases through compression of the term premia depends, in part, on expectations of how policymakers will adjust short-term interest rates in the future in response to the stronger real activity and inflation sparked by lower term premia.