"1 My first observation is that the general public already transacts mostly in digital dollars—by sending and receiving electronic balances in our commercial bank accounts. These digital dollars are not a CBDC, because they are liabilities of commercial banks rather than the Federal Reserve.
• To illustrate this, chart 2 shows a historical decomposition of the changes in the euro area 10-year OIS rate based on a two-country time series model.1 This model tries to disentangle several driving factors behind the recent rise in euro area risk free yields, such as the effect of policy and macro news on both sides of the Atlantic.