I am extremely pleased that so much progress has been achieved on the TSI over the last few months because it is an initiative that has been strongly supported by the Eurosystem over the years, and in particular through the ECB Contact Group on Euro Securities Infrastructures, COGESI.
In the past three years, the Fed has bought over $ trillion of securities issued or backed by the government. The Fed has funded that purchase by tripling the amount of deposits held by banks with the Fed – what are called bank reserves. The standard reasoning is that this kind of reserve creation is inflationary.