The distribution of liquidity to entities without access to the deposit facility is amplified by our asset purchases, which mechanically channel liquidity to large financial institutions located outside of the euro area.
The phenomenon that we see of money market rates below policy rates is not unique to the euro area, but is visible in most, if not all, cases where asset purchases have significantly ramped up excess liquidity. Take for example the US, where the Federal Funds rate is trading below the Fed’s Interest Rate on Excess Reserves.