## Implications of Central Bank Digital Currencies for Monetary Operations NOTE/2024/007

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### Overview
- Central banks face two-part policy questions when contemplating CBDC issuance:
  - How will monetary policy transmission to output and inflation be affected?
  - How will CBDC introduction affect monetary operations—the management of demand for and supply of reserves to achieve a desired policy stance?
- This Fintech Note focuses on the second question and analyzes implications based on three substitution scenarios: CBDC substituting for cash, commercial bank deposits, and reserves.
- Key CBDC design drivers influencing scenarios:
  - (1) access—who can hold and transact in CBDC;
  - (2) remuneration—expected returns from holding CBDC;
  - (3) holding limits—maximum thresholds on CBDC holdings.
- Market developments (for example, tokenized deposits and tokenized assets) could increase demand for a wholesale CBDC as a settlement asset and induce substitution from reserves to CBDC.
- Emphasis on balance sheets of the central bank, the banking sector, and the nonbank sector to illustrate effects on reserve supply/demand and short-term interest rates.

### Three scenarios of CBDC substitution (definitions and design levers)
- Scenarios considered:
  - CBDC substitutes for cash (CiC).
  - CBDC substitutes for commercial bank deposits.
  - CBDC substitutes for central bank reserves (wholesale CBDC).
- Common assumptions:
  - Substitution occurs at par and largely on demand.
  - Scenarios are not mutually exclusive; a single CBDC design could produce simultaneous substitution across forms of money.
- Design features likely to favor each scenario:
  - Retail-focused, non-remunerated CBDC with low holding limits → more likely to substitute for cash.
  - Wider nonbank access, remunerated CBDC, higher holding limits → more likely to substitute for bank deposits.
  - CBDC available only to commercial banks with very high or no limits → more likely to substitute for reserves.
- Other factors: level of financial inclusion, development of financial markets, and other CBDC design features.

### Balance-sheet implications and effects on short-term interest rates
- Scenario-specific balance-sheet summaries:
  - Cash substitution:
    - Central bank liabilities composition changes; commercial bank balance sheets and reserve balances are not directly affected.
    - Implications for interest rates are more limited.
    - CBDC adds an autonomous, potentially volatile factor to liquidity forecasting.
  - Deposit substitution:
    - Commercial banks lose deposits and reserves as clients substitute deposits for CBDC.
    - Short-term interest rates can deviate from the target if reserves are reduced.
  - Reserve substitution (wholesale):
    - Effects depend on the relative treatment of CBDC and reserves; if treated equivalently and exchangeable at par, liability distribution changes but levels of central bank money held by banks remain unchanged.
- Operational context:
  - Analysis emphasizes inflation-targeting regimes operating either a corridor or floor system; also reflects on exchange rate– and monetary–targeting regimes.
  - Corridor systems require accurate and frequent liquidity forecasts; floor systems operate with ample reserves and target the floor interest rate.

### Adapting monetary operations and design responses (operational recommendations)
- Operational responses for cash and deposit substitution scenarios:
  - Upgrade liquidity forecasting.
  - Introduce facilities to fine-tune daily provision of liquidity.
  - Temporarily adopt operational regimes less prone to liquidity shocks (for example, fully meeting market demand for reserves at a fixed price).
- If deposit substitution causes short-term rates to deviate from target:
  - Provide liquidity using monetary policy instruments to return rates to target.
- For reserve substitution:
  - Ensure interoperability.
  - Allow banks to freely convert CBDC into reserves at par to prevent market price distortions and undesirable liquidity fragmentation.
- CBDC design measures to manage adverse impacts:
  - Adjust access criteria or impose holding limits to dampen banking disintermediation in the deposit substitution scenario.
  - Treat CBDC as equal to reserves—examples include counting CBDC toward the reserve requirement or remunerating CBDC-like reserves in a floor system—to facilitate operations in the reserve substitution scenario.
- Guiding principle: CBDC design should primarily serve its policy objectives while considering effects on the central bank’s ability to conduct monetary operations effectively.

### Box 1 — Further details on the three scenarios (stylized effects, quantitative examples, operational responses)
- Scenario definitions and stylized balance-sheet effects:
  - Scenario 1 — Cash substitution:
    - Targets retail cash use case; CBDC designed with cash-like features (widely accessible, zero interest, small transaction caps).
    - Stylized balance-sheet effect: nonbank sector substitutes 10 units of cash for 10 units of CBDC; central bank liabilities composition changes identically without directly affecting commercial bank balance sheets or reserve balances.
  - Scenario 2 — Deposit substitution:
    - CBDC accessible to individuals and businesses with bank accounts.
    - Stylized balance-sheet effect: nonbank sector substitutes 10 units of bank deposits for 10 units of CBDC; commercial banks draw down liabilities and reserves by 10 units; central bank shows 10 units of CBDC while reserves shrink by 10 units.
    - Motivations for substitution include payment convenience and flight to risk-free CBDC during banking crises, regardless of remuneration.
  - Scenario 3 — Reserve substitution (wholesale CBDC):
    - CBDC provided to financial institutions with reserve accounts; assumed to complement, not fully replace, reserves.
    - Use cases include atomic delivery-versus-payment for tokenized securities, settlement asset for tokenized deposits, enhancing cross-border wholesale payments, and providing 24/7 resilience/backup settlement.
    - Stylized balance-sheet effect: commercial banks substitute reserves for CBDC; central bank updates liability structure correspondingly.
    - Scenario 3 can support Scenario 2 when banks distribute CBDC to households/businesses and hoard CBDC balances for off-hour demand.
- Key quantitative examples from stylized illustrations:
  - 10 units of cash → 10 units of CBDC (Scenario 1).
  - 10 units of bank deposits → 10 units of CBDC (Scenario 2).
  - 10 units of reserves → 10 units of CBDC (Scenario 3).
  - Example reserve balance in a stylized intervention (Scenario 2):
    - Initial reserve balance: 20 units.
    - Central bank injects reserves via OMOs/SFs: 2 units.
    - After purchases and adjustments, reserve balance maintained at 27.3 units to satisfy reserve requirement ratio of 0.3.
- Effects on short-term interest rates by scenario:
  - Scenario 1:
    - Unlikely to affect short-term interest rates significantly because reserve balances and commercial bank balance sheets are not directly affected.
    - CBDC introduces an additional autonomous factor for liquidity forecasting; demand for CBDC may be more volatile than CiC.
  - Scenario 2:
    - Likely to affect short-term interest rates initially because both demand for and supply of reserves are affected (reserves decrease when deposits convert to CBDC).
    - Reserve supply and demand curves shift left; magnitude corresponds to degree of substitution and CBDC adoption.
    - Possible bank responses affecting reserve demand include balance-sheet shrinkage, changes in precautionary reserve demand, efforts to attract deposits with higher rates, use of wholesale funding, and a greater demand for high-quality liquid assets.
    - System effects depend on monetary framework:
      - Corridor system: short-term interest rates may rise if demand for reserves falls less than supply; if demand falls by as much as supply, rates may be unchanged.
      - Floor system (reserves ample): changes in reserve supply unlikely to affect short-term interest rates unless supply shrinks drastically below the parsimonious floor.
  - Scenario 3:
    - Unlikely to significantly affect short-term interest rates if wholesale CBDC is treated as equivalent to reserves (regulatory treatment, remuneration, and access).
    - If CBDC and reserves exchange at par and on-demand, banks hold unchanged amounts of central bank money in wholesale accounts; central bank liability distribution changes but not levels.
- Liquidity forecasting and operational adjustments (recommended tools):
  - Temporarily switch from corridor targeting to targeting a fixed rate with full allotment.
  - Open additional intra-day windows for finer operations.
  - Narrow the corridor between ceiling and floor rates.
  - Introduce longer averaging periods for reserve requirements.
  - Provide liquidity at longer maturities.
  - Monitor interest rate movements more actively during initial CBDC introduction.
- Reserve injections and balance-sheet responses (Scenario 2):
  - Inject reserves via OMOs such as repurchase agreements or standing facilities.
  - For large, persistent CBDC demand, consider asset purchases or long-term lending to expand the central bank balance sheet:
    - Purchase government securities to permanently inject reserves.
    - Provide extended-maturity liquidity instruments.
  - Risks and constraints of large asset purchases: increased exposure to interest rate, foreign exchange, and credit risks; limited availability of eligible securities; institutional limits on holdings; potential market distortions if supply is constrained.
  - Central bank must be prepared to provide last-resort lending in the event of rapid deposit outflows and liquidity crunches.
- Operational and regulatory treatment of wholesale CBDC (Scenario 3):
  - Ensure interoperability and seamless exchanges between CBDC and reserves to prevent market price distortions and liquidity fragmentation.
  - Reduce operational complexity by treating wholesale CBDC as equivalent to reserves for regulatory treatment, remuneration, and access, or restrict wholesale CBDC to intraday holdings.
  - Operational choices include treating wholesale CBDC economically and legally equivalent to sight deposits or allowing wholesale CBDC only intraday with conversion into reserve balances by end of day.
  - Potential complexities if treated differently: more erratic reserve demand (spikes before RR averaging periods or end of day) and additional liquidity management costs for banks.
- Design trade-offs and considerations:
  - CBDC attractiveness relative to cash and deposits depends on perceived safety, ease of access, convenience, remuneration, programmability, cost of use, privacy, anonymity, and wide acceptance.
  - Key design levers to mitigate operational impacts—each with adoption trade-offs:
    - Access (who can hold CBDC).
    - Quantity limits (transaction or holding caps).
    - Remuneration (interest or zero interest).
  - Central banks should weigh operational and monetary implications against the risk of undermining CBDC adoption.

### Box 1 — Empirical example on digital volatility (Cambodia’s Bakong system)
- Bakong (2020 launch) is a retail peer-to-peer digital payment system; Bakong balances are liabilities of participating banks; Bakong is not a CBDC.
- Prefunding and liquidity effects:
  - Participating banks prefund Bakong settlement accounts by transferring funds from their NBC current accounts; large Bakong payment demand reduces current account balances and system liquidity similar to increased CiC demand.
  - Bakong operates on gross transactions (vs cash netting), increasing transaction volatility.
  - Banks can only prefund Bakong settlements during NBC business hours, prompting pre-weekend/holiday balance increases and more volatile volumes.
- Measured volatility (October 2021–October 2023):
  - Bakong’s volatility was 36 times higher than CiC.
  - Daily average: 12.5 percent of Bakong versus 0.3 percent for CiC.
- Operational implication:
  - Bakong must be treated as an additional autonomous factor in liquidity forecasting; monetary operations should be calibrated accordingly.

### Box 3 — The Bank of England omnibus accounts (operational model and policy implications)
- Overview:
  - Bank of England launched an omnibus account model in 2021 enabling a broader range of innovative payment system operators to access the real-time gross settlement system.
  - An omnibus account co-mingles funds of different entities in a single account offered to regulated payment system operators.
  - The model allows the payment system operator to fund wholesale settlements on their platform with central bank money.
- Operational features:
  - Payment system operator holds the omnibus account on behalf of participants and must maintain a one-to-one value of its omnibus account and the sum of participants’ balances.
  - Balances held on the omnibus account overnight are remunerated at the Bank Rate.
  - The payment system operator must fully pass on the interest rate to participants in their system.
  - Only entities that are participants in the Sterling Monetary Framework can hold an overnight entitlement.
- Monetary policy and transmission implications:
  - By mandating participant eligibility and treating omnibus-account funds at par with funds in standard RTGS accounts, the Bank ensures the omnibus model has no impact on monetary policy transmission.
  - Remuneration at Bank Rate with full pass-through underpins parity with standard reserve accounts and mitigates risks to policy transmission.
- Access and participant eligibility (Sterling Monetary Framework):
  - Participants include commercial banks, building societies, designated investment firms, and central counterparties.
  - Participants have access to reserve balances remunerated at Bank Rate.

*Source: FINTECH NOTES — Implications of Central Bank Digital Currencies for Monetary Operations (Introduction, Box 1, Box 3).*

### Introduction ...........................................................................................................

### Introduction

### Overview
- Central banks contemplating issuance of central bank digital currencies (CBDCs) face a two-part policy question:
  - First: how will the transmission of the monetary policy stance to the broader economy—output and inflation—be affected? (See IMF Fintech Note and CBDC Handbook Chapter “Implications of CBDCs for Monetary Policy Transmission” by Das and others (2023).)
  - Second: how will the introduction of CBDCs affect monetary operations—the process through which central banks use instruments to manage the demand for and supply of reserves to achieve a desired stance of policy?
- This Fintech Note focuses on the second question and analyzes implications of CBDC issuance based on three scenarios: CBDC substituting for cash, commercial bank deposits, and reserves.
- Key drivers of which scenario occurs include CBDC design features such as:
  - (1) access—who can hold and transact in CBDC;
  - (2) remuneration—expected returns from holding CBDC; and
  - (3) holding limits—maximum thresholds on CBDC holdings.
- Market developments (for example, increased demand for tokenized deposits and tokenized assets) could increase demand for a wholesale CBDC as a settlement asset and induce substitution from reserves to CBDC.
- The analysis emphasizes balance sheets of the central bank, the banking sector, and the nonbank sector to illustrate effects on the supply of and demand for reserves and short-term interest rates.

### Three Scenarios of CBDC Substitution
- The note considers three main substitution scenarios:
  - CBDC substitutes for cash (CiC).
  - CBDC substitutes for commercial bank deposits.
  - CBDC substitutes for central bank reserves (wholesale CBDC).
- Assumptions common to the scenarios:
  - Substitution occurs at par and largely on demand.
  - Scenarios are not mutually exclusive; a single CBDC design could produce simultaneous substitution across forms of money.
- Design features likely to favor each scenario:
  - Retail-focused, non-remunerated CBDC with low holding limits → more likely to substitute for cash.
  - Wider nonbank access, remunerated CBDC, higher holding limits → more likely to substitute for bank deposits.
  - CBDC available only to commercial banks with very high or no limits → more likely to substitute for reserves.
- Other factors influencing degrees of substitution: level of financial inclusion, development of financial markets, and other CBDC design features.

### Balance Sheet and Short-Term Interest Rate Effects
- Each scenario has different balance sheet implications for central bank, banking sector, and nonbank sector, affecting the supply of and demand for reserves and short-term interest rates.
- Scenario-specific summaries from the introduction:
  - Cash substitution:
    - Implications for interest rates are more limited.
    - Central banks may find liquidity forecasting more challenging.
  - Deposit substitution:
    - More likely to affect monetary operations because commercial banks would lose reserves as clients substitute deposits for CBDC.
    - Short-term interest rates can deviate from the target if reserves are reduced.
  - Reserve substitution (wholesale):
    - Implications depend on the relative difference between CBDC and reserves.
    - If commercial banks settle interbank payments in CBDC instead of reserves, effects hinge on how CBDC is treated relative to reserves.
- Operational emphasis:
  - The analysis focuses on inflation-targeting regimes operating either a corridor or floor system but also reflects on exchange rate– and monetary–targeting regimes.
  - Central banks in corridor systems need accurate and frequent liquidity forecasts; floor systems operate with ample reserves and target the floor interest rate.

### Adapting Monetary Operations and CBDC Design
- Central bank operational responses suggested in the introduction:
  - For cash and deposit substitution scenarios:
    - Upgrade liquidity forecasting.
    - Introduce facilities to fine-tune daily provision of liquidity.
    - Temporarily adopt operational regimes less prone to liquidity shocks (for example, fully meeting market demand for reserves at a fixed price).
  - For deposit substitution when short-term rates deviate from target:
    - Provide liquidity using monetary policy instruments to return rates to the target level.
  - For reserve substitution:
    - Ensure interoperability.
    - Allow banks to freely convert CBDC into reserves at par to prevent market price distortions and undesirable liquidity fragmentation.
- CBDC design measures to manage adverse impacts:
  - Adjust access criteria or impose holding limits to dampen banking disintermediation in the deposit substitution scenario.
  - Treat CBDC as equal to reserves—examples include counting CBDC toward the reserve requirement or remunerating CBDC-like reserves in a floor system—to facilitate operations in the reserve substitution scenario.
- Emphasis: CBDC design should primarily serve its policy objectives but consider how features affect the central bank’s ability to conduct monetary operations effectively.

### Regime Considerations and Scope
- The note concentrates on implications under inflation-targeting regimes with corridor or floor operational systems; it also briefly considers messages under exchange rate or monetary-targeting regimes.
- It does not assess the suitability of particular CBDC scenarios for any country; appropriateness depends on country circumstances, preparedness, and CBDC objectives.
- Analysis is largely conceptual, informed by extensive experience in monetary operations; findings will be revised as more countries roll out CBDCs and practical lessons emerge.

*Source: FINTECH NOTES — Implications of Central Bank Digital Currencies for Monetary Operations (Introduction).*

### Box 1. Further Details on the Three Scenarios of CBDC Substitution

### Box 3. The Bank of England Omnibus Accounts

### Box 3. The Bank of England Omnibus Accounts

### Overview
- The Bank of England launched a new omnibus account model in 2021 that enables a broader range of innovative payment system operators to access the real-time gross settlement system.
- An omnibus account is defined as one where the funds of different entities are co-mingled in a single account offered to regulated payment system operators (Bank of England 2021).
- The model allows the payment system operator to fund wholesale settlements on their platform with central bank money.

### Operational features
- The payment system operator holds the omnibus account on behalf of their participants and is responsible for maintaining a one-to-one value of its omnibus accounts and the sum of participants’ balances in its platform.
- Balances held on the omnibus account overnight will be remunerated at the Bank Rate.
- The payment system operator holding the omnibus account must fully pass on the interest rate to participants in their system.
- As such, only entities that are participants in the Sterling Monetary Framework can hold an overnight entitlement.

### Monetary policy and transmission implications
- By mandating participant eligibility and treating funds in omnibus accounts at par with funds in standard real-time gross settlement system accounts, the Bank ensures that the omnibus model has no impact on the transmission of monetary policy.
- The treatment of omnibus-account balances as remunerated at Bank Rate, with full pass-through by operators to participants, underpins the parity with standard reserve accounts and mitigates risks to policy transmission.

### Access and participant eligibility (Sterling Monetary Framework)
- Sterling Monetary Framework refers to the Bank of England’s operational framework for implementing monetary policy in the sterling money markets.
- The participants of this framework include commercial banks, building societies, designated investment firms, and central counterparties.
- They have access to the reserve balances, which are remunerated at Bank Rate (Bank of England 2015).

*International Monetary Fund — Fintech Notes: Implications of Central Bank Digital Currencies for Monetary Operations (Box 3).*

### References

### References

### IMF and IMF-affiliated working papers, Fintech Notes, and IMF publications
- Armas, Adrian, and Manmohan Singh. 2022. “Digital Money and Central Banks Balance Sheet.” IMF Working Paper No 2022/206, International Monetary Fund, Washington, DC.
- Brandao-Marques, Luis, and Lev Ratnovski. 2024. “The ECB’s Future Monetary Policy Operational Framework: Corridor or Floor?” IMF Working Paper WP/24/56, International Monetary Fund, Washington, DC.
- Chen, Zhuohui, Nikolaus Kourentzes, and Romain Veyrune. 2023. “Modelling the Reserve Demand to Facilitate Central Bank Operations.” IMF Working Paper No 2023/179, International Monetary Fund, Washington, DC.
- Das, Mitali, Tommaso Mancini Griffoli, Fumitaka Nakamura, Julia Otten, Gabriel Soderberg, Juan Sole, and Brandon Tan. 2023. “Implications of Central Bank Digital Currencies for Monetary Policy Transmission.” IMF Fintech Note 2023/010, International Monetary Fund, Washington, DC.
- Della Valle, Guido, Darryl King, and Romain Veyrune. 2022. “Monetary and Capital Markets Department Technical Assistance Handbook: Reserve Requirements.” International Monetary Fund, Washington, DC.
- Gross, Marco, and Elisa Letizia. 2023. “To Demand or Not to Demand: On Quantifying the Future Appetite for CBDC.” IMF Working Paper WP/23/009, International Monetary Fund, Washington, DC.
- He, Dong, Annamaria Kokenyne, Tommaso Mancini Griffoli, Marcello Miccoli, Thorvardur Tjoervi Olafsson, Gabriel Soderberg, and Herve Tourpe. 2023. “Capital Flow Management Measures in the Digital Age (2): Design Choices for Central Bank Digital Currency.” IMF Fintech Note 2023/009, International Monetary Fund, Washington, DC.
- Kahn, Charles M., Manmohan Singh, and Jihad Alwazir. 2022. “Digital Money and Central Bank Operations.” IMF Working Papers 2022/085, International Monetary Fund, Washington, DC.
- Lee, Jang-Yung. 1997. “Sterilizing Capital Inflows.” Economic Isses No 7, International Monetary Fund, Washington, DC.
- Lukonga, Inutu. 2023. “Monetary Policy Implications of Central Bank Digital Currencies: Perspectives on Jurisdiction with Conventional and Islamic Banking Systems.” IMF Working Paper No 2023/060, International Monetary Fund, Washington, DC.
- Soderberg, Gabriel, John Kiff, Herve Tourpe, Marianne Bechara, Stephanie Forte, Kathleen Kao, Ashley Lannquist, Tao Sun, and Akihiro Yoshinaga. 2023. “How Should Central Banks Explore Central Bank Digital Currency? A Dynamic Decision-Making Framework.” IMF Fintech Note 2023/008, International Monetary Fund, Washington, DC.
- Tan, Brandon. 2023. “Central Bank Digital Currency Adoption: A Two-Sided Model.” IMF Working Paper 2023/127. International Monetary Fund, Washington, DC.
- Veyrune, Romain, Guido Della Valle, and Shayuo Guo. 2018. “Relationship between Short-Term Interest Rates and Excess Reserves: A Logistic Function.” IMF Working Paper No 2018/80, International Monetary Fund, Washington, DC.

### Central bank publications, speeches, remarks, and working papers
- Bank of England. 2015. “The Bank of England’s Sterling Monetary Framework.” Bank of England, London.
- Bank of England. 2021. “Bank of England Omnibus Accounts—Access Policy.” Bank of England, London.
- Bank of England and HM Treasury. 2023. “The Digital Pound: A New Form of Money for Households and Businesses.” Consultation Paper, Bank of England, London.
- Barrdear, John, and Michael Kumhof. 2021. “The Macroeconomics of Central Bank Digital Currencies.” Bank of England, London.
- Bindseil, Ulrich. 2020. “Tiered CBDC and the Financial System.” ECB Working Paper Series No 2351, European Central Bank, Frankfurt am Main, Germany.
- Bindseil, Ulrich, Piero Cipollone, and Jürgen Schaaf. 2024. “Digital Euro: Debunking Banks’ Fears about Losing Deposits.” The ECB Blog, 19 February 2024, European Central Bank, Frankfurt am Main, Germany.
- BIS Innovation Hub (BISIH), Bank of France, and Swiss National Bank. 2021. “Project Jura—Cross-Border Settlement Using Wholesale CBDC.” Bank for International Settlements, Basel, Switzerland.
- Bowman, Michelle W. 2023. “Considerations for a Central Bank Digital Currency.” Speech at the Georgetown University McDonough School of Business Psaros Center for Financial Markets and Policy, Board of Governors of the Federal Reserve System, Washington, DC.
- European Central Bank (ECB). 2024a. “Progress on the Preparation Phase of a Digital Euro.” First Progress Report, European Central Bank, Frankfurt am Main, Germany.
- European Central Bank (ECB). 2024b. “Update on Workstream on the Methodology for the Calibration of Holding Limits.” 11th ERPB Technical Session on Digital Euro, European Central Bank, Frankfurt am Main, Germany.
- Federal Reserve Bank of New York. 2023. “FAQs: Reverse Repurchase Agreement Operations.” Federal Reserve Bank of New York, New York.
- Hauser, Andrew. 2022. “Old Dogs, New Tricks: Adapting Central Bank Balance Sheet to a World of Digital Currencies.” Remarks given at Federal Reserve Bank of New York and Columbia SIPA Workshop on “Monetary Policy Implementation and Digital Innovation,” New York, NY.
- Infante, Sebastian, Kyungmin Kim, Anna Orlik, André F. Silva, and Robert J. Tetlow. 2023. “Retail Central Bank Digital Currencies: Implications for Banking and Financial Stability.” Finance and Economics Discussion Series, 2023-072, Board of Governors of the Federal Reserve System, Washington, DC.
- Jordan, Thomas. 2024. “Project Helvetia III—The Swiss National Bank’s Pilot for Wholesale CBDC.” Remarks at the BIS Innovation Summit, 6 May 2024, Basel, Switzerland.
- Keister, Todd. 2012. “Corridors and Floors in Monetray Policy.” Liberty Street Economics Blog, 4 April 2012, Federal Reserve Bank of New York, New York.
- Kumhof, Michael, and Clare Noone. 2018. “Central Bank Digital Currencies—Design Principles and Balance Sheet Implications.” Staff Working Paper No 752, Bank of England, London.
- Meaning, Jack, Ben Dyson, James Barker, and Emily Clayton. 2018. “Broadening Narrow Money: Monetary Policy with a Central Bank Digital Currency.” Staff Working Paper No 724, Bank of England, London.
- People’s Bank of China. 2021. “Progress of Research & Development of E-CNY in China.” People’s Bank of China, Beijing, China.
- Panetta, Fabio. 2022. “The Digital Euro and the Evolution of the Financial System.” Introductory Statement at the Committee on Economic and Monetary Affairs of the European Parliament, Brussels, June 15.
- Jordan, Thomas. 2024. “Project Helvetia III—The Swiss National Bank’s Pilot for Wholesale CBDC.” Remarks at the BIS Innovation Summit, 6 May 2024, Basel, Switzerland.

### Bank for International Settlements (BIS), ECB, and other multilateral reports
- Abad, Jorge, Galo Nuño Barrau, and Carlos Thomas. 2023. “CBDC and the Operational Framework of Monetary Policy.” BIS Working Papers No 1126, Bank for International Settlements, Basel, Switzerland.
- Group of Central Banks. 2021. “Central Bank Digital Currencies: Financial Stability Implications.” Report no 4 in a Series of Collaborations from a Group of Central Banks, Bank of International Settlements, Basel, Switzerland.
- BIS Innovation Hub (BISIH), Bank of France, and Swiss National Bank. 2021. “Project Jura—Cross-Border Settlement Using Wholesale CBDC.” Bank for International Settlements, Basel, Switzerland.

### Academic journals, NBER, and other scholarly works
- Agur, Itai, Anil Ari, and Giovanni Dell’Ariccia. 2022. “Designing Central Bank Digital Currencies.” Journal of Monetary Economics 125: 62–79.
- Anderson, Richard G., Michael Bordo, and John V. Duca. 2016. “Money and Velocity During the Financial Crises: From the Great Depression to the Great Recession.” NBER Working Paper 22100, National Bureau Economic Research, Cambridge, MA.
- Brunnermeier, Markus K., and Dirk Niepelt. 2019. “On the Equivalence of Private and Public Money.” Journal of Monetary Economics 106: 27–41.
- Chiu, Jonathan, Seyed Mohammadreza Davoodalhosseini, Janet Jiang, and Yu Zhu. 2023. “Bank Market Power and Central Bank Digital Currency: Theory and Quantitative Assessment.” Journal of Political Economy 131 (5): 1213–48.
- Croce, Enzo, and Mohsin S. Khan. 2000. “Monetary Regimes and Inflation Targeting.” Finance and Development, September, International Monetary Fund, Washington, DC.
- Kahn, Charles M., Manmohan Singh, and Jihad Alwazir. 2022. “Digital Money and Central Bank Operations.” IMF Working Papers 2022/085, International Monetary Fund, Washington, DC.
- Tan, Brandon. 2023. “Central Bank Digital Currency Adoption: A Two-Sided Model.” IMF Working Paper 2023/127. International Monetary Fund, Washington, DC.

### Methodology, operational, and technical references
- Baliño, Tomás J. T., and Lorena M. Zamalloa. 1997. Instruments of Monetary Management Issues and Country Experiences. Washington, DC: International Monetary Fund.
- Gray, Simon. 2008. “Liquidity Forecasting.” Centre for Central Banking Studies, Bank of England, London.
- Gray, Simon, and Nick Talbot. 2006. “Monetary Operations.” Centre for Central Banking Studies, Bank of England, London.
- King, Darryl, and Tommaso Mancini-Griffoli. 2018. “Monetary Operations.” In Advancing the Frontiers of Monetary Policy, edited by Tobias Adrian, Douglas Laxton, and Maurice Obstfeld. Washington, DC: International Monetary Fund.
- Veyrune, Romain, Guido Della Valle, and Shayuo Guo. 2018. “Relationship between Short-Term Interest Rates and Excess Reserves: A Logistic Function.” IMF Working Paper No 2018/80, International Monetary Fund, Washington, DC.
- Caccia, Enea, Jens Tapking, and Thomas Vlassopoulous. 2024. “Central Bank Digital Currency and Monetary Policy Implementation.” ECB Occasional Paper Series No 345, European Central Bank, Frankfurt am Main, Germany.
- Disyatat, Piti. 2008. “Monetray Policy Implementation: Misconceptions and Their Consequences.” BIS Working Papers No 269, Bank for International Settlements, Basel, Switzerland.
- Vergote, Olivier, Werner Studener, Ioannis Efthymiadis, and Niall Merriman. 2010. “Main Drivers of the ECB Financial Accounts and ECB Financial Strength over the First 11 Years.” ECB Occasional Paper Series No 111, European Central Bank, Frankfurt am Main, Germany.

*Implications of Central Bank Digital Currencies for Monetary Operations  NOTE/2024/007*

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_Source: https://www.imf.org/-/media/files/publications/ftn063/2024/english/ftnea2024007.pdf_