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Liquidity: Difference between revisions
→Bank Reserves
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The correlation between the stock market and bank reserves has been closely follow since it suggests the sock market follows the movement of reserves. | The correlation between the stock market and bank reserves has been closely follow since it suggests the sock market follows the movement of reserves. | ||
* As an effect of QT, Bank reserves are also declining, they stand at 3.1 Trillions, it has declined$ 1 trillion since November 2021, a 25% decline, | * As an effect of QT, Bank reserves are also declining, they stand at 3.1 Trillions, it has declined$ 1 trillion since November 2021, a 25% decline, | ||
* It has been stable the last 3 months, which could explain some of the financial easing that we saw in January 2023 <ref>https://fred.stlouisfed.org/series/TOTRESNS</ref> | |||
* Bank reserves are still above the pre-pandemic level | * Bank reserves are still above the pre-pandemic level | ||