It also argues that the stigma associated with banks’ borrowing from the central bank needs to be reduced and that many of the fund-absorbing tools adopted during the crisis should be maintained. This is particularly important in the near future since central banks will need to absorb large amounts of liquidity during the process of normalising monetary policy.
During the crisis central banks also intervened in a number of dysfunctional markets on an emergency basis.27 It seems unlikely that these interventions will continue after the crisis has abated. Nevertheless, the fact that these interventions occurred and were perceived as successful suggests that central banks will be less hesitant to intervene if these markets were to face renewed stress.