Search: Nominal interest rate
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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.
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Appendix
1 Dec 1989
RDP
8908
i. t. =. k-period domestic nominal interest rate in period t; and. ... i. t. =. k-period foreign interest rate in period t. Equation (7) states that the differential between k-period nominal interest rates equals the expected change in the exchange rate
https://www.rba.gov.au/publications/rdp/1989/8908/appendix.html
Capital Flows and Exchange Rate Determination
1 Dec 1989
RDP
8908
Research Discussion Papers contain the results of economic research within the Reserve Bank
https://www.rba.gov.au/publications/rdp/1989/8908.html
Exchange Rate Determinants
1 Dec 1989
RDP
8908
One way that nominal interest rates and exchange rates are linked is the medium-term linkage through the rate of inflation. ... High relative inflation is usually associated with high nominal interest rates and a depreciating currency.
https://www.rba.gov.au/publications/rdp/1989/8908/exchange-rate-determinants.html
Implications for Monetary Policy
1 Dec 1989
RDP
8908
Download the Paper 1.12. MB. If we accept the common-sense proposition that the exchange rate is sensitive to domestic and foreign interest rates, and put aside the fact that ... In a country with a floating exchange rate and interest sensitive capital
https://www.rba.gov.au/publications/rdp/1989/8908/implications-for-monetary-policy.html
Monetary Management in the Post-Float Period
1 Dec 1989
RDP
8908
Figure 3. INTEREST RATES & THE EXCHANGE RATE. in the first half of 1985, when the Australian dollar fell sharply, monetary policy was tightened. ... Thus, from late 1987 to early 1989, rises in interest rates tended to be accompanied by rises in the
https://www.rba.gov.au/publications/rdp/1989/8908/monetary-management-in-the-post-float-period.html