Central banks must rethink their accounting treatment of money

In a recent study, Stijn Claessens, Thomas Glaessner and Daniela Klingebiel raised a crucial alarm: central banks are becoming more vulnerable financially. They argue that, amid today’s rising economic and political uncertainties, central banks must rethink how they maintain financial resilience. Among their recommendations is a review of capital adequacy frameworks and revenue models.

We fully agree with the need for bolstering central bank finances. Yet we believe this effort requires

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