TBNPortugal
Liquidity of the banks is divided by the ECB's responsibility
Publication: ECO
Author: ECO
Source published: 08/10/2026, 09:47:21 UTC
Briefing created: 07/11/2026, 05:45:07 UTC
Based on a feed excerpt; full article content has not been acquired. Source evidence retrieved 08/10/2026, 09:56:24 UTC.
Briefings
Belgian central bank governor Pierre Wunsch opposed a proposal to raise mandatory reserve ratios, arguing it blurs the line between monetary and fiscal policy. This debate occurs amid a period of high liquidity in the Eurosystem, with over 2.1 trillion euros in excess reserves accumulated since the 2010s. The proposal aims to retain a larger share of this non-remunerated liquidity to mitigate Eurosystem losses from rising interest rates, though Wunsch warns it risks becoming a fiscal instrument.
Key points
- Pierre Wunsch, governor of the Belgian National Bank and member of the European Central Bank Council, publicly opposed a proposal to increase mandatory reserve ratios for commercial banks.
- The proposal aims to retain a larger share of non-remunerated excess liquidity in the Eurosystem to mitigate losses from rising interest rates, though it risks blurring monetary and fiscal policy boundaries.
Context
The debate arises in a period of high liquidity in the Eurosystem, with over 2.1 trillion euros in excess reserves accumulated since the 2010s. The proposal aims to retain a larger share of this non-remunerated liquidity to mitigate losses from rising interest rates, though it risks blurring monetary and fiscal policy boundaries.
Limitations
Evidence is limited to a single statement from Pierre Wunsch at a conference in Brussels. The article does not provide specific dates for the liquidity accumulation period beyond the 2010s, nor does it contain data on the exact magnitude of the proposed reserve ratio increase or the specific financial institutions involved in the liquidity retention strategy.
Generated by Bittrees-hosted qwen35-2b sha256:aaf42c8b7c3c on 07/11/2026, 05:45:07 UTC. Based on publisher-provided feed evidence; may not cover the full original article. Check the source for details.
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