in the policy rate so that the impact on financial and monetary conditions is of the originally - desired size. but another solution is to anchor other rates directly to the central bank policy intentions by the provision of liquidity. the fixed - rate full allotment regime can achieve this outcome because, in effect, it squeezes out the premium at short maturity via the intermediation role taken up by the central bank. this assumes, however, that the counterparties of the central bank are still fundamentally sound. a similar logic can also be applied to longer maturities. the central bank can provide liquidity at longer maturity at the average policy rate that will prevail in the future over this maturity. this can be done at any level of policy rate. the existence of the deposit facility provides a floor to the overnight rate. and the central bank can extend its influence over term credit by lengthening the maturity of its lending operations. see, friedman, m. and schwartz, a. j. ( 1982 ), monetary trends in the united states and the united kingdom : their relation to income, prices, and interest rates, university of chicago press, chicago, pp. 1867 – 1975, and meltzer, a. h. ( 1999 ), “ commentary : monetary policy at zero inflation ”, in new challenges for monetary policy : a symposium sponsored by the federal reserve bank of kansas city, federal reserve bank of kansas city. bis central bankers ’ speeches one notable application of this logic was the 12 - month refinancing operation enacted in december 2009. in this operation, the ecb stood ready to satisfy fully the demand for liquidity at one - year maturity. the interest rate charged on this liquidity was the average mro rate that would prevail over the life of the operation. this type of measure is distinct from attempts to flatten the “ risk - free ” yield curve via forward guidance which is often discussed in the literature. the reason is that it is aimed at squeezing out the premium faced by banks over and above the current and expected policy rate. let me recall that, in the euro area, about three - quarters of corporate finance comes from banks. hence, anchoring banks ’ funding conditions to the desired level can help ensure that lending rates faced by households and firms continue to reflect policy intentions. this was indeed the case during the first phase of the crisis, with lending rates declining in tandem with policy rates according to standard regularities. 3 central banks ’ willingness to

amando m tetangco, jr : we are all wealth watchers speech by mr amando m tetangco, jr, governor of bangko sentral ng pilipinas ( bsp, the central bank of the philippines ), at the wealth watch book launch, manila, 3 july 2015. * * * this is the second time this week that we are launching a document related to financial empowerment. just two days ago, we launched the national strategy for financial inclusion, the document signed by 13 government agencies ( including the bsp ) which sets the strategic map for a unified national financial inclusion landscape. it is a living document that is meant to be populated by tactical plans of each of the agencies involved. and it is envisioned that following the launch, significant partnerships among government agencies as well as with the private sector would ensue. as you know, we had the queen of the netherlands, the un secretary general ’ s special advocate for financial inclusion for development, queen maxima, witness that occasion as our special guest. while we do not have a queen with us today, we are most privileged to have you our most significant partners in this journey of financial literacy and education and consumer protection to share this occasion with us. today, we launch a different document. a book. in fact, a “ wealth book ”. unlike the nsfi, this wealth watch book is not authored by 13 government agencies, but the book is authored by those “ closer to home ” – by our very own bspers from the financial consumer protection department ( fcpd ). the book is not for those who have no access to financial products and services but, it is for those who have a little bit more than others well, perhaps significantly more but who may need to be just as “ watchful ” in many respects, however, this book and the nsfi are about the same. because like the nsfi, our wealth watch book deals with information, and how you can make that information “ work ” for you. it is about stewardship of what you have. it is about preparing for unexpected events. it is about growth and growing what you have so you can have more. our launch today brings to mind the nba draft. at each draft, media would focus on how those towering “ boys ” who ’ ve been drafted would now move from “ living within tight college budgets ” to becoming and i quote from yahoo sports “ money making machines ”. sadly, however, we so often hear