Let me stress, however, that over the medium term I see neither the risk of deflation, nor the risk of inflation. In times of crisis it may happen that the traditional instruments of monetary policy don’t suffice, or that they become blunt. This is particularly true of the key interest rate, which may eventually approach the lower boundary of zero.
Yet, in such a situation, there are still other measures to which central banks may turn. 2  BIS Review 81/2009  One possibility would be to widen money supply and to use the additional funds to purchase assets such as government bonds, but also commercial bonds, instruments issued by other banks or other financial assets.