Conclusion Let me conclude. Depending on how it materialises, bank deleveraging has a potential to impede the recovery and make it more difficult for central banks to engineer an appropriate degree of monetary accommodation or, to the contrary, to support the transmission of monetary policy.
First, interest rates on fixed income securities and in money markets in the industrialised economies have fallen to near record low levels as a result of the extraordinary measures taken by central banks in these countries to inject liquidity in order to bolster financial markets and aggregate demand.