Therefore, it is all the more important for the central bank to provide the price stability anchor to the market.3 Moreover, the zero bound on the nominal interest rate erodes the market mechanism in the financial market as well as market discipline, thereby distorting the allocation of funds on the market.
In the past several months, we encountered a difficulty in achieving the bank reserve target due to undersubscription to our offers in open market operations, and allowed a temporary deviation from the lower limit of the reserve target in early June, end-July, and early August.