Market maker of last resort

Financial markets - central oversight.

(MMLR).

Market maker of last resort describes exceptional market intervention by a central bank.

In normal times, central banks support market liquidity by providing liquidity insurance to individual institutions.

Exceptionally, a central bank may stand ready to act as a temporary market maker of last resort, to improve the liquidity of one or more markets whose illiquidity posed a threat to financial stability, or was judged to be important to the transmission mechanism of monetary policy.

See also

• Bank of England
• Capital market
• Central bank
• Financial stability
• Lender of last resort
• Liquidity
• Market maker
• Monetary policy