As consequence, the functioning of the interbank market was seriously hampered and the ability of banks to provide credit to the real economy was at risk. These developments severely jeopardised the ECB’s ability to affect economic magnitudes and ultimately to contain downside risks to price stability.
In response, the ECB embarked on a series of “non-standard” measures with the aim of relieving liquidity and funding constraints in the banking sector and mitigating impairments to the monetary policy transmission channels.