What Drives the German Target Balances? Evidence from a Bvar Approach

Determinants of Target2 Transactions of European Banks Based on Micro-Data

“…They find that policy uncertainty and the ECB collateral policy are key factors. Finally, Bettendorf and Jochem (2022) used a BVAR model in order to decompose German TARGET2 dynamics to variable impacts of global risk shocks, domestic risk shocks and monetary policy shocks. All these studies rely on macroeconomic data.…”