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RBA Glossary definition for Real interest rate

Real interest rate – The real interest rate refers to the cost of borrowing money (i.e. the nominal interest rate) net of inflation. It takes account of the fact that part of the nominal interest that borrowers pay to lenders represents compensation for anticipated inflation. The remaining �real� component better reflects the economic cost of borrowing and the return to lending.

RBA Glossary definition for interest rate

interest rate – The term used to describe the cost of borrowing money or the return to the owner of the funds which are invested or lent out. It is usually expressed as a percent per annum of the amount of money borrowed, lent or invested.

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The Rise in Household Liquidity

10 Nov 2021 RDP 2021-10
Gianni La Cava and Lydia Wang
Specifically, disinflation and falling real interest rates have increased housing prices and housing deposits, and have also made it easier to amortise existing debt. ... The relevant interest rate is derived from RBA statistical table ‘F5 Indicator
https://www.rba.gov.au/publications/rdp/2021/2021-10/full.html

Appendix B: Cross-country Evidence on Liquidity Buffers

10 Nov 2021 RDP 2021-10
Gianni La Cava and Lydia Wang
Δ. B. U. F. F. E. R. c. t. ). and the explanatory variables. (. Δ. X. c. t. ). include the change in real interest rates, the change in the housing ... 0.46. (0.12). Change in inflation rate. 0.00. (0.00). 0.00. (0.00). Change in real long-term
https://www.rba.gov.au/publications/rdp/2021/2021-10/appendix-b.html

Appendix D: Household Liquidity, Precautionary Saving and Borrowing Constraints

10 Nov 2021 RDP 2021-10
Gianni La Cava and Lydia Wang
The model is partial equilibrium in nature in that it takes income, housing prices and interest rates as given. ... positive real interest rate and a positive initial value for the asset):.
https://www.rba.gov.au/publications/rdp/2021/2021-10/appendix-d.html

References

10 Nov 2021 RDP 2021-10
Gianni La Cava and Lydia Wang
Black S, D Titkov and L Wang (2020), ‘Developments in Banks' Funding Costs and Lending Rates’, RBA Bulletin, March. ... Tobin J (1956), ‘The Interest-Elasticity of Transactions Demand for Cash’, The Review of Economics and Statistics, 38(3), pp
https://www.rba.gov.au/publications/rdp/2021/2021-10/references.html

The Rise in Household Liquidity

10 Nov 2021 RDP 2021-10
Gianni La Cava and Lydia Wang
Specifically, disinflation and falling real interest rates have increased housing prices and housing deposits, and have also made it easier to amortise existing debt. ... As further evidence, we use local projection methods to demonstrate that lower
https://www.rba.gov.au/publications/rdp/2021/2021-10/the-rise-in-household-liquidity.html