March 2021

Post n°209

Understanding the expansion of central banks’ balance sheets

Published on 03/25/2021

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By Emmanuel Cerclé, Hervé Le Bihan and Michaël Monot

Central banks' balance sheets have grown significantly, as a result of the "non-standard" monetary policies conducted in response to the 2008 crisis and the Covid-19 crisis. Reflecting the net asset purchase programmes in place, they are still expanding. However, over the longer term, their size could stabilise and then gradually decline once inflation has consistently returned to close to its target. Adjusting the size of their balance sheets should nevertheless remain in central banks' toolbox.

Chart1: Balance sheets of the Eurosystem, the FED and the BoJ (in amounts and as a % of GDP)
Chart1: Balance sheets of the Eurosystem, the FED and the BoJ (in amounts and as a % of GDP) Source: ECB, FED, BoJ, Eurostat Note: Top panel: amount in billions of euros (G€), dollars (G$), and yen (G¥). Bottom panel: as a % of GDP.
Updated on 03/30/2021 11:12
Post n°208

What conclusions can be drawn from the implementation of the two-tier system?

Published on 03/12/2021

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By Samuel Bieber

The two-tier system, which has been in place for over a year in the euro area, exempts part of banks' excess reserve holdings with the central bank from negative remuneration. This system aims to support the bank-based transmission of monetary policy. It has not unduly influenced money market rates.

Chart 1: Excess reserves exempted and non-exempted from negative remuneration (EUR billion)
Chart 1: Excess reserves exempted and non-exempted from negative remuneration (EUR billion) Source: Banque de France, European Central Bank
Updated on 03/12/2021 16:25
Post n°207

Women and labour during the Covid-19 crisis

Published on 03/08/2021

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By Clémence Berson

The Covid-19 crisis has had a profound impact on the organisation of labour. Women have been on the front line both in tackling the virus and in looking after their family and relatives in these difficult times. Their participation in the labour market has not been significantly affected, thanks both to public aid policies and to their efforts in balancing their professional and private responsibilities.

Chart 1: Change in the employment rate by gender, comparison between the Great Recession and the Covid crisis – Q4 2008 and 2019 = 100
Chart 1: Change in the employment rate by gender, comparison between the Great Recession and the Covid crisis – Q4 2008 and 2019 = 100 Source: INSEE. Key: The female employment rate fell by 0.3 percentage point between Q4 2019 and Q1 2020.
Updated on 03/08/2021 15:37
Post n°206

Uncertainty due to Covid-19 is contributing to French household savings

Published on 03/03/2021

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By Stefan Gebauer, Jean-François Ouvrard and Camille Thubin

We study the role of precautionary savings in the recent rise in French household savings. Using different approaches, we show that elevated uncertainty contributed to the surge in savings in 2020, notably in the first lockdown. For the whole year, however, uncertainty effects were small compared to the contribution of administrative spending constraints.

Figure 1: Household savings ratio in France (in % of disposable income)
Figure 1: Household savings ratio in France (in % of disposable income) Source: INSEE (most recent observation: 2020Q4). Note: Household savings in per cent of gross disposable income. Most recent observation: 2020Q4.
Updated on 03/03/2021 14:46