We have to look at the consolidated balance sheet of the government and the central bank

In almost all countries, central banks belong to governments and pay their profits to them. This means that only the consolidated balance sheet of the government and the central bank makes sense, and not the separate balance sheets of the two institutions. We are therefore building, for the United States, the euro zone and Japan, the consolidated balance sheet of the government and the central bank, which mainly has: On its asset side, the cumulative fiscal deficit and the central bank's claims on the private sector; On its liabilities side, banknotes, the part of the public debt (short-term and long-term) that is not held by the central bank, and banks' reserves at the central bank. This consolidated balance sheet shows that the government (in the broad sense) finances itself heavily in the short term (banknotes, short-term Treasury bills, banks' reserves), and is therefore also highly sensitive to short-term interest rates, not only long-term interest rates.