The main difference between a sterilized intervention and unsterilized intervention in the foreign exchange market is

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The main difference between a sterilized intervention and unsterilized intervention in the foreign exchange market is that a sterilized intervention does not change the monetary base, while an unsterilized intervention does. In a sterilized intervention, the central bank buys or sells foreign currency while simultaneously engaging in a domestic open market operation to offset the effect on the monetary base. This means that the intervention has no effect on the overall money supply. In contrast, an unsterilized intervention does not involve an offsetting open market operation, which means that it does affect the monetary base and therefore the overall money supply.

The Main Difference Between a Sterilized Intervention and Unsterilized Intervention