Reserve Bank Purchases of Government Securities

Starting Thursday, 5 November 2020, the Reserve Bank will begin purchasing Australian Government securities (AGS) and securities issued by the state and territory central borrowing authorities (semis) in the secondary market under the $100 billion bond purchase program set out in the Governor's Statement of 3 November 2020.

The purchases of $100 billion will take place over a period of approximately six months, with weekly purchases of around $5 billion. The allocation of bond purchases is planned to be around 80 per cent AGS and around 20 per cent semis. Purchases will be conducted on Monday, Wednesday and Thursday of each week, excluding public holidays and excluding 24 December 2020 to 7 January 2021. The focus of purchases will be bonds with residual maturity of around 5 to 10 years, but may also include bonds outside of this range, depending on market conditions. Purchases of AGS with residual maturity of around 5 to 7 years are planned for Mondays, and purchases of AGS with residual maturity of around 7 to 10 years are planned for Thursdays. Semis purchases are planned for Wednesdays, alternating weekly between shorter-dated and longer-dated securities depending on market conditions. The size of the initial auctions for AGS will be around $2 billion and the size of the initial auctions for semis will be around $1 billion. The purchases will be conducted via multi-price auctions. The Bank will closely monitor the impact of purchases on market functioning and will adjust the auctions if necessary, including their size, composition and timing.

The Reserve Bank will also continue to purchase government securities, as needed, to ensure that the yield on the 3-year Australian Government bond remains consistent with the Board's target and to address any market dislocations in the shorter end of the yield curve. These purchases will be announced as relating to the yield target, and will not form part of the $100 billion bond purchase program described above.

The $100 billion bond purchase program will involve purchasing fixed-rate, nominal bonds issued by the Australian Government and states and territories. Inflation-indexed bonds will not be purchased under the program. The Reserve Bank will exclude from purchases any bond lines that the Bank is aware had recently been tapped by the issuing authority or are newly issued bonds.


The Reserve Bank will announce its intentions for government securities purchases at 11.15 am (AEST/AEDT) on the day of purchase via Yieldbroker DEBTS. The announcement will indicate the total face value (AUD) and specific securities the Reserve Bank is willing to purchase, the time within which offers are to be submitted, the settlement date (T+2), and whether the purchases relate to the $100 billion bond purchase program or to the yield target.

A less detailed notification of the operation will also be provided via the market data services (Reuters – RBA27; Bloomberg – RBAO8) at the same time.

Eligible Counterparties

All RITS members deemed eligible to participate in the Reserve Bank's domestic market operations may participate in the AGS auctions (see Eligible Counterparties).


Approaches are to be made over Yieldbroker DEBTS.

Offers are to be made in absolute yields in quarter basis point increments, with a minimum offer of $5 million face value and increments of $1 million.

Participants who encounter difficulties in submitting their offers over that system should directly contact Yieldbroker DEBTS and also inform the Reserve Bank's Domestic Markets Desk by email.

Offers cannot be submitted, changed or withdrawn after the cut-off time for submissions has passed.


Allocation within an individual bond line will be made on the basis of yield. Allocation between bond lines will be made on a relative value basis, subject to the Reserve Bank's discretion, and for the states and territories will also be guided by the stock of debt outstanding.

Approaches may be partially filled. Multiple successful approaches for a given security at the same yield are filled on a pro-rata basis.

An approach exceeding the total transaction amount indicated by the Reserve Bank for the operation is regarded as equal to the total transaction amount for determining pro-rata allocations.

Approaches that are partially filled are rounded up to the nearest million dollars.


All participants will be notified promptly of the success or otherwise of their offers via Yieldbroker DEBTS.

Aggregated results will be published on market data services shortly after the auction, and on the RBA website. Historical results are published in Statistical Table A3 on the Reserve Bank website. These include the issuer and series, face value and weighted average and cut-off yields for each security purchased. No information regarding the identities of the Reserve Bank's counterparties will be made public.

Securities Lending

The Reserve Bank stands ready to lend securities against AGS and semis (i.e. general collateral) on a reverse enquiry basis.

Reserve Bank of Australia
3 November 2020