In fact, even before May when the BSP acted first, our vigilant message to the market of our readiness to act has already started to move market rates including T-bills and T-bond rates, interbank call loan rates
Table 3 illustrates one link between call loan rates and aggregate NYC bank clearinghouse deposits and reserves.
The spring and fall peaks in bond trading volumes also correspond to seasonal peaks in call loan rates. (22) As well, the suspension of convertibility by NYC clearing banks was associated with a period of heightened liquidity of our sample of railroad bonds.
Railroad bond prices appear to bottom during the week of November 23, 1907, in contrast to the reversal in call loan rates that started the week of October 26, 1907 (as noted above and shown in Table 3.
Assuming a 15 percent annual call loan rate, which was somewhat typical for November 1907, a 7-day loan would cost 0.28 percent, or 15 percent divided by 52 weeks.
The weighted average of unsecured overnight call loan rates
dropped to zero for the first time in the Tokyo market Monday, money traders said.
The lack of unanimity left financial analysts wondering whether some board members may have objected to some aspects of the central bank's currency policy, which includes an official discount rate of as low as 0.5% and steering the weighted average of overnight unsecured call loan rates
to around 0.25%.
The bankers acceptance and call loan rates, however, did not have statistically significant seasonal patterns.
Comparison of the two figures shows that the increase in the seasonal amplitude of the call loan rate during the Depression was small relative to the decline in amplitude in 1914.(37) For comparison, the standard deviation of the seasonal pattern of the call loan rate between January 1890 and October 1914 is 1.02 (0.67 for the first difference of the call loan rate).
(36) The call loan rate did have a statistically significant seasonal pattern between January 1919 and December 1927.
"This has helped strengthen the monetary transmission mechanism in terms of the alignment between market interest rates and the BSP's policy rate, with interbank call loan rates
moving steadily within the corridor.
The BOJ has pegged the discount rate, which it charges commercial banks for loans, at the current level since September 1995, and since February has steered its target for unsecured overnight call loan rates
to close to zero.