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RBA Glossary definition for cash rate target

cash rate target – As in most developed countries, the stance of monetary policy in Australia is expressed in terms of a target for an overnight interest rate. The rate used by the Reserve Bank of Australia is the cash rate (also known as the interbank overnight rate). When the Reserve Bank Board decides that a change in monetary policy should occur, it specifies a new target for the cash rate. A decision to ease policy is reflected in a new lower target for the cash rate, while a decision to tighten policy is reflected in a higher target.

RBA Glossary definition for Cash Rate

Cash Rate – The interest rate which banks pay to borrow funds from other banks in the money market on an overnight basis. The cash rate is the Reserve Bank of Australia's operational target for the implementation of monetary policy. It is also an important financial benchmark in the Australian financial markets. It is used as the reference rate for Australian dollar Overnight Indexed Swaps (OIS) and the ASX 30 Day Interbank Cash Rate Futures. The Reserve Bank of Australia is the administrator of the cash rate. The cash rate is calculated as the weighted average interest rate on overnight unsecured loans between banks settled in the Reserve Bank Information and Transfer System (RITS). The Cash Rate is also known by the acronym AONIA in financial markets.

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Monetary Policy Goals for Inflation in Australia

30 Nov 2009 RDP PDF 85KB
The coefficient on R is the mean coefficient on lags 2 to 5 of the real cash rate. ... is at its target rate of0.5 per cent per quarter, and output is growing at trend.
https://www.rba.gov.au/publications/rdp/1995/pdf/rdp9503.pdf

Is the Phillips Curve Still a Curve? Evidence from the Regions

29 Aug 2021 RDP PDF 1706KB
cash rate will not be raised until inflation is sustainably within the 2 to 3 per cent target range. ... prevent inflation straying too far from target (tolerating a higher unemployment rate to achieve.
https://www.rba.gov.au/publications/rdp/2021/pdf/rdp2021-09.pdf

Non-technical summary for 'The Yield and Market Function Effects of the Reserve Bank of Australia's Bond Purchases'

19 May 2022 RDP PDF 469KB
RDP 2022-02 non-technical summary
https://www.rba.gov.au/publications/rdp/2022/2022-02/rdp-2022-02-non-technical-summary.pdf

Anticipatory Monetary Policy and the ‘Price Puzzle’

18 May 2017 RDP PDF 2157KB
2.1 Step #1: Construct the Measure of Monetary Shocks. The Board of the RBA meet to decide on the target cash rate 11 times per year, on the first Tuesday ... That is, we regress the change in the target cash rate announced at Board meeting m on the
https://www.rba.gov.au/publications/rdp/2017/pdf/rdp2017-02.pdf

Consumer Payment Behaviour in Australia: Evidence from the 2019 Consumer Payments Survey

9 Sep 2020 RDP PDF 1619KB
use of digital payment credentials. Despite the trend towards electronic payments, cash still. ... predominantly low-value payments). Consumers in all broad demographic groups are using cash.
https://www.rba.gov.au/publications/rdp/2020/pdf/rdp2020-06.pdf

Identifying Interbank Loans from Payments Data

6 Dec 2016 RDP PDF 3267KB
these observations have an implied interest rate equal to the target cash rate. ... Figure 2: Implied Interest Rates of Algorithm Matches. Implied rate of simple interest, deviation from target cash rate, 2015.
https://www.rba.gov.au/publications/rdp/2016/pdf/rdp2016-11.pdf

Fiscal Policy and the Inflation Target

4 Feb 2015 RDP PDF 847KB
As reported by Reifscheider and Williams (2000, Table 1), the volatility of other variables, such as the inflation rate or interest rates, is not greatly affected by the inflation target. ... Figure 4 plots the standard deviation of the unemployment rate
https://www.rba.gov.au/publications/rdp/2014/pdf/rdp2014-02.pdf

Identifying Repo Market Microstructure from Securities Transactions Data

13 Aug 2018 RDP PDF 2622KB
more narrowly around the cash rate. Another way to examine false detections is to look for implied interest rates that are not whole basis. ... 14. Figure 2: Repo Detections at Placebo Rates. Against spread to cash rate or to negative of cash rate, log
https://www.rba.gov.au/publications/rdp/2018/pdf/rdp2018-09.pdf

A Model of the Australian Housing Market

5 Mar 2019 RDP PDF 1639KB
r is the average real expected. variable mortgage rate, which Fox and Tulip estimated using 10-year fixed mortgage rates. ... government bond yield, cash is the cash rate, inflation is 10-year inflation compensation derived from indexed bonds.
https://www.rba.gov.au/publications/rdp/2019/pdf/rdp2019-01.pdf

On Some Recent Developments in Monetary Economics

19 Nov 2012 RDP PDF 829KB
the financial system will lead to changes in cash rates aud exchange rates,. ... proponents of a range of alternative possible "targets" for monetary policy -. including the exchange rate (real or nominal), interest rates, even the growth.
https://www.rba.gov.au/publications/rdp/1986/pdf/rdp8605.pdf