I feel more at home knowing I’m not really at home. It takes all the pressure off you trying to fit in!
– John Oliver
A higher IOER rate encourages banks to raise the interest rates they charge, putting upward pressure on market interest rates regardless of the level of reserves in the banking sector. While adjusting the IOER rate is an effective way to move market interest rates when reserves are plentiful, federal funds have generally traded below this rate.
– Janet Yellen