This rate is in compliance with the provided demand of the economy for money, coming from its real growth by 6 percent. The Bank of Albania monetary program is designed in line with other policies of the economy, where its harmonisation with the government fiscal policy is highlighted. The Bank of Albania estimates that like in the past years, even in 2005, the country's economic development will be in conformity with the overall development program objectives. The last developments of the banking system consolidate the optimism that it will fulfil to the best of its knowledge the role of financial intermediation in the economy. We deem that its consolidation will continue with accelerated rhythms throughout this year, providing to the large public more credits, more services and more security in the savings conduct. 2/2
Unlike Desk operations conducted with fixed quantities, the Desk wouldn’t need to estimate the appropriate amount of reverse repos to offer each day in order to absorb the quantity of reserve balances at the target rate.16 With IOER and an overnight, fixed-rate, full-allotment reverse repo facility, counterparties would determine the level of participation based on daily demand for overnight investments at a fixed rate that’s judged consistent with the FOMC’s overall policy stance. Market forces will therefore determine how to allocate the Federal Reserve’s liabilities between depository institutions holding them as reserves and money market funds, GSEs, and other non-bank financial institutions holding them as reverse repos. The effectiveness of an overnight, fixed-rate, full-allotment facility in helping to control overnight money market rates will depend on a range of factors, including whether a sufficiently wide set of non-bank counterparties has access to the facility. Following seven waves of counterparty expansions since 2009, the Desk currently has 139 reverse repo counterparties, covering 94 of the largest 2a-7 money market funds, 6 GSEs, 18 banks, and the 21 primary dealers. Taken together, these institutions represent an estimated 25 percent of all overnight Treasury tri-party repo volume. More counterparties could certainly be added, and we’re in the process of considering how best to proceed. The efficacy of the facility will also depend on factors such as the regulatory and balance sheet constraints of counterparties and the level of competition in the markets.