Search: cash rate explained
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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The Cash Market in Australia
31 Jan 2006
RDP
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245KB
The weighted average of these two rates is called the official cash rate. ... In practice, it is the unofficial cash rate which is targeted by the Bank (though, as explained later, the unofficial and official cash rates are about equal).
https://www.rba.gov.au/publications/rdp/1992/pdf/rdp9214.pdf
Demand in the Repo Market: Indirect Perspectives from Open Market Operations from 2006 to 2020
9 May 2024
RDP
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4625KB
fixed interest rate in exchange for receiving the average cash rate recorded over the term of the swap. ... from financial institutions. This measure of the cash rate has been published by the Reserve Bank.
https://www.rba.gov.au/publications/rdp/2024/pdf/rdp2024-03.pdf
The Role of Collateral in Borrowing
14 Jan 2021
RDP
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1784KB
liquid safe assets. This liquid asset demand encourages collateralised lending, contrary to cash. ... Heightened demand for high-quality collateral is. evident from the interest rate differential on collateralised loans across collateral types – rates
https://www.rba.gov.au/publications/rdp/2021/pdf/rdp2021-01.pdf
On Some Recent Developments in Monetary Economics
19 Nov 2012
RDP
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829KB
the financial system will lead to changes in cash rates aud exchange rates,. ... overall level of interest rates. Indeed, with innovations such as. floating-rate loans diffused widely, this sensitivity may have lessened.
https://www.rba.gov.au/publications/rdp/1986/pdf/rdp8605.pdf
Macroprudential Limits on Mortgage Products: The Australian Experience
4 Aug 2021
RDP
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2345KB
quarter t , minus the cash rate, in percentage points. It is first differenced in most regressions. ... controls, given that the cash rate is a very strong determinant of mortgage rates.
https://www.rba.gov.au/publications/rdp/2021/pdf/rdp2021-07.pdf
The Yield and Market Function Effects of the Reserve Bank of Australia’s Bond Purchases
19 May 2022
RDP
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1938KB
AGS yields to term-matched overnight indexed swap (OIS) rates.10 The cash rate target was reduced. ... the expected average overnight cash rate over the term of the OIS contract.
https://www.rba.gov.au/publications/rdp/2022/pdf/rdp2022-02.pdf
Australian Money Market Divergence: Arbitrage Opportunity or Illusion?
12 Sep 2019
RDP
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1464KB
Note: (a) Discounted variable rates on owner-occupier housing loans; spread to cash rate. ... money markets declined as the spread between money market rates and cash rate expectations.
https://www.rba.gov.au/publications/rdp/2019/pdf/rdp2019-09.pdf
The Rise in Household Liquidity
24 Nov 2021
RDP
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1793KB
Midrigan forthcoming). The higher rate of saving has occurred through both amortising mortgage. ... projection methods to demonstrate that lower interest rates are associated with higher household.
https://www.rba.gov.au/publications/rdp/2021/pdf/rdp2021-10.pdf
The Relationship between Actual Investment and Survey-based Expectations
19 Nov 2012
RDP
PDF
548KB
10-year Treasury Bonds) interest rates. The expected interest rate can be. ... 9. by comparing, in the case of short-term rates, the difference between the rate.
https://www.rba.gov.au/publications/rdp/1988/pdf/rdp8810.pdf
The Implementation of Monetary Policy in Australia
1 Dec 2009
RDP
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190KB
It hasalso led to a substantial decline in the volatility of short-term interest rates and morerapid pass-through of changes in the target cash rate into deposit and lending rates. ... 4.2 Influence on Other Short-term Interest Rates. Short-term market
https://www.rba.gov.au/publications/rdp/1997/pdf/rdp9703.pdf