The Reluctance to Borrow from the Fed
Posted: 24 Aug 2001
Banks prefer borrowing in the federal funds market, even when the Fed offers a confidential, guilt-free, and less expensive alternative. This suggests that commercial banks deliberately avoid borrowing from the central bank.
Keywords: Discount window, special lending facility, federal funds market
JEL Classification: E52, E58, G21
Suggested Citation: Suggested Citation