Despite near-zero interest rates set by large central banks and other steps towards monetary easing in recent years, the economic environment has been characterised by low inflation globally and deflationary fears in some regions, while real economic activity has remained moderate. Although...

Reserve portfolios prior to the Global Financial Crisis provided positive (low) returns for central banks or had extremely low probabilities of earning negative returns. In the wake of the crisis, expansionary monetary policy created a low yield environment at a scale that was never seen before....