It is also conceivable, as Jeremy Stein and his co-authors have suggested, for central banks to issue bills to satisfy safe asset demand in the non-bank system.20 And central banks can meet demand for special collateral by re-lending their bond portfolios, which the ECB is already doing, although this could be scaled up.
When South Africa’s Constitution was adopted in 1996, the drafters of our fundamental law insisted that the primary objective of the SARB was to ‘protect the value of the currency in the interest of balanced and sustainable economic growth in the Republic’.