经济学第十章.pptVIP

Source: Reserve Bank of Australia (2009), About Monetary Policy, viewed 22 March 2009, at .au. Short-term interest rates, Australia, 1985-2008 (monthly average): Figure 16.4 Hubbard, Garnett, Lewis and O’Brien: Essentials of Economics ? 2010 Pearson Australia How the RBA manages the supply of cash. Exchange settlement accounts (ESAs): Accounts held with the RBA by banks and other financial institutions to enable the overnight transfer of funds (cash) between financial institutions, and between the RBA and financial institutions. ESA’s enable real-time gross settlement (RTGS) through the RBA information and transfer system (RITS). Balances held in ESAs are called exchange settlement funds. The demand for and supply of money How the RBA manages the supply of cash. To reduce the cash rate, the RBA publicly announces that it intends to do so. The RBA will then either: Not sterilise an overnight surplus, or Offer to buy back repurchase agreements, or make outright purchases of bonds. When the RBA pays for the bonds, this increases cash reserves held by financial institutions and the rate of interest will fall. The demand for and supply of money How the RBA manages the supply of cash. To increase the cash rate, the RBA publicly announces that it intends to do so. The RBA will then either: Not sterilise an overnight shortage, or Use reverse repurchase agreements or carry out the outright sale of bonds. When the RBA pays for the bonds, this reduces cash reserves held by financial institutions and the rate of interest will rise. The demand for and supply of money Equilibrium in the money market. The RBA will use monetary policy to keep interest rates at its target rate. Therefore the money supply curve is a horizontal line at the current interest rate. note that the RBA used to use monetary target, ie changing the money supply curve to change interest rates but that no longer happens The demand for and supply of money Interest rate (per cent per year) Quantity of money (