Whatever might be the medium-term or long-term objectives of Stabilization Funds or SWFs, they could be utilized as official reserves as they are either under the control of the monetary authority or can be made available to the monetary authority in case of need. Hence, these funds are sometimes described as “quasi reserves”.
- 13 Concluding Remarks In closing, I think of our new flexible average inflation-targeting framework as a combination of TPLT at the ELB with flexible inflation targeting, to which TPLT reverts once the conditions to commence policy normalization articulated in our September 2020 FOMC statement have been met. In this sense, our new framework indeed represents an evolution, not a revolution.