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 A: A Small Macroeconomic Model of Australia
31 Dec 2002
RDP
2002-01
f. is the G3 real interest rate. ... where the equilibrium G3 real interest rate is 2 per cent and the equilibrium world inflation rate is 2.5 per cent.
https://www.rba.gov.au/publications/rdp/2002/2002-01/appendix-a.html
Evidence from a Small Empirical Macro Model
31 Dec 2002
RDP
2002-01
The real exchange rate is explained by movements in the terms of trade and real interest rate differentials. ... The standard deviation of the quarterly interest rate changes ranges between 2 and 5 per cent per annum.
https://www.rba.gov.au/publications/rdp/2002/2002-01/evidence-from-a-small-empirical-macro-model.html
Which Inflation Rate to Target in an Open Economy?
31 Dec 2002
RDP
2002-01
The third equation implies that the exchange rate appreciates in response to a rise in domestic interest rates. ... The policy-maker can thus successfully stabilise the inflation rate, but at the cost of inducing additional volatility in output, as
https://www.rba.gov.au/publications/rdp/2002/2002-01/which-inflation-rate-to-target-in-an-open-economy.html