Bulletin – September Quarter 2017 Structural Liquidity and Domestic Market Operations Abstract

The Reserve Bank is a net supplier of liquidity to the Australian financial system. This reflects demand for the Reserve Bank's liabilities from its customers, as well as the asset allocation decisions of the Reserve Bank. The key drivers of variations in the amount of liquidity supplied by the Reserve Bank have been fluctuations in government deposits and the demand for banknotes. The Reserve Bank meets the demand for liquidity through its domestic market operations.

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