Central bank lending

Central banks generally have responsibility for promoting an economy’s macroeconomic goals, such as price stability or low and stable inflation, high employment, and maximum sustainable economic growth. To do so, they typically use a number of tools such as open market operations, reserve requirements, adjustments to policy interest rates, and lending. This article focuses on the lending function of central banks, often referred to as the discount window. Reflecting the professional backgrounds of the authors, the article focuses on the U.S. experience.