Search: Nominal interest rate
RBA Glossary definition for Nominal interest rate
Nominal interest rate – The nominal interest rate refers to the cost of borrowing money before adjustment for inflation i.e. it includes compensation for the expected erosion of the value of the borrowed funds due to inflation. It is the cost visible to the borrower, and is composed of the real interest rate plus inflation.
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.
Search Results
The Main Questions
1 Dec 1988
RDP
8812
Under some theories, nominal interest rates can only move out of line with those overseas when there is the expectation of an exchange rate change. ... This suggests that the synchronisation of domestic and foreign nominal interest rates has not
https://www.rba.gov.au/publications/rdp/1988/8812/main-questions.html
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Introduction
1 Nov 1990
RDP
9009
For example, if nominal interest rates increase because inflation is expected to increase, the exchange rate will probably depreciate, contrary to the predictions of the portfolio balance model. ... Using this model, we can then examine the effects of
https://www.rba.gov.au/publications/rdp/1990/9009/introduction.html
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Results
31 Dec 2005
RDP
2005-04
For the (hypothetical) second, the ZLB is not a constraint, so that a negative nominal interest rate setting can (in some unspecified way) be achieved, if desired. ... Once again, it is interesting to consider the sensitivity of these results to changes
https://www.rba.gov.au/publications/rdp/2005/2005-04/results.html
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Interest rates in a sticky-price monetary model
1 Oct 1987
RDP
8708
where. r. t. is the one period nominal interest rate;. π. ... Equation (8) is the equation for determination of the one-period bond price or nominal interest rate in the sticky price monetary model.
https://www.rba.gov.au/publications/rdp/1987/8708/interest-rates-in-a-sticky-price-monetary-model.html
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Does Monetary Policy Affect Non-mining Business Investment in Australia? Evidence from BLADE
21 Sep 2023
RDP
2023-09
investment. Indeed, a negative relationship between investment and interest rates is hard to find in aggregate time series data (e.g. ... For example, survey evidence suggests that firms' hurdle rates do not respond to interest rate changes (Lane and
https://www.rba.gov.au/publications/rdp/2023/2023-09/full.html
Results
1 Jan 1992
RDP
9201
Macfarlane and Tease (1989) argue that for some of the floating period the relationship between the exchange rate and interest rates was dominated by a policy reaction function from the exchange ... rate to interest rates.
https://www.rba.gov.au/publications/rdp/1992/9201/results.html
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The Interest Rate Reaction Functions
23 Mar 2009
RDP
2009-01
If central bankers really did mechanically follow an interest rate rule, their optimal policy rules would have the nominal interest rate responding only to CPI inflation. ... In practice, however, central bankers set the interest rates to achieve their
https://www.rba.gov.au/publications/rdp/2009/2009-01/interest-rate-reaction-functions.html
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Doing Less, with Less: Capital Misallocation, Investment and the Productivity Slowdown in Australia
22 Mar 2023
RDP
2023-03
It will also make it harder to conduct monetary policy, as it will mean lower potential growth and real neutral interest rates, increasing the likelihood that nominal interest rates hit the ... This low level of non-mining investment occurred despite
https://www.rba.gov.au/publications/rdp/2023/2023-03/full.html
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Annex: Real Interest Parity
1 Mar 1992
RDP
9203
The major practical problem here is that ex ante real interest rates are not directly observable. ... Following Cumby and Mishkin (1986), a constant term, a time trend, the current nominal interest rate, i.
https://www.rba.gov.au/publications/rdp/1992/9203/annex-real-interest-parity.html
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References
6 May 2018
RDP
2018-05
RDP 2018-05: Do Interest Rates Affect Business Investment? Evidence from Australian Company-level Data References. ... Hambur J and R Finlay (2018), ‘Affine Endeavour: Estimating a Joint Model of the Nominal and Real Term Structures of Interest Rates
https://www.rba.gov.au/publications/rdp/2018/2018-05/references.html
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