Episode

How Central Banks Use Liquidity Coverage Ratios

Podcast
Monetary Policy Explained with Fexingo: Central Banks, Money Supply, and Interest Rates
Published
Jul 17, 2026
Duration seconds
396
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https://audio.fexingo.com/business/monetary-policy-explained/episode-0116.mp3
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Summary

Episode 116 of Monetary Policy Explained with Fexingo dives into the Liquidity Coverage Ratio — the post-2008 rule that forces banks to hold enough high-quality liquid assets to survive a 30-day stress scenario. Lucas and Luna walk through how the LCR reshaped bank balance sheets, why it matters for money markets, and what happens when central banks tighten policy in a world where banks must hoard Treasuries. They anchor the discussion to the 2023 banking turmoil and the 2026 rate environment, using data from the Fed's discount window and money market fund flows. A concrete look at how a regulatory ratio became a transmission mechanism for monetary policy. #LiquidityCoverageRatio #LCR #CentralBanks #MonetaryPolicy #BankRegulation #BaselIII #HQLA #Treasuries #MoneyMarkets #DiscountWindow #BankingTurmoil #FederalReserve #LiquidityRisk #30DayStress #RepoMarket #FexingoBusiness #BusinessPodcast #Economics Keep every episode free: buymeacoffee.com/fexingo