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RBA Glossary definition for Real interest rate

Real interest rate – The real interest rate refers to the cost of borrowing money (i.e. the nominal interest rate) net of inflation. It takes account of the fact that part of the nominal interest that borrowers pay to lenders represents compensation for anticipated inflation. The remaining �real� component better reflects the economic cost of borrowing and the return to lending.

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 D: Glossary and Data

1 Jun 2000 RDP 2000-05
Meredith Beechey, Nargis Bharucha, Adam Cagliarini, David Gruen and Christopher Thompson
t. = i. t. (p. t. p. t4. ). foreign real short term policy interest rate. ... Source:. Interest rates: Reserve Bank of Australia Bulletin, Table F.11. For the German repo rate prior to 1999: Datastream, FOOIRGRR.
https://www.rba.gov.au/publications/rdp/2000/2000-05/appendix-d.html

Overview

1 Jun 2000 RDP 2000-05
Meredith Beechey, Nargis Bharucha, Adam Cagliarini, David Gruen and Christopher Thompson
Real interest rates, which appear in the equations for output and the real exchange rate, are calculated using past inflation to deflate nominal interest rates. ... The real exchange rate is determined by the terms of trade and the differential between
https://www.rba.gov.au/publications/rdp/2000/2000-05/overview.html

Simulations

1 Jun 2000 RDP 2000-05
Meredith Beechey, Nargis Bharucha, Adam Cagliarini, David Gruen and Christopher Thompson
The real exchange rate appreciates to a new long-run level in response to higher domestic real interest rates (not shown), while the nominal exchange rate continues to appreciate as domestic ... Since real interest rates are kept constant by assumption,
https://www.rba.gov.au/publications/rdp/2000/2000-05/simulations.html

The Steady State and Potential Output

1 Jun 2000 RDP 2000-05
Meredith Beechey, Nargis Bharucha, Adam Cagliarini, David Gruen and Christopher Thompson
per cent per annum. The world (G3) real short-term interest rate is assumed to equal its average over the period 1985:Q1–1999:Q3. ... a). Δθ. t. The real exchange rate is constant in the steady state because the terms of trade and real interest rate
https://www.rba.gov.au/publications/rdp/2000/2000-05/steady-state-and-potential-output.html

Appendix B: Testing for a Structural Break

1 Jun 2000 RDP 2000-05
Meredith Beechey, Nargis Bharucha, Adam Cagliarini, David Gruen and Christopher Thompson
165.484). Real cash rate (lags 2 to 7). (b). 0.052. {0.001}. ... 0.430). Real interest rate differential (lag 1). 0.590. (0.252). 0.734. (0.340).
https://www.rba.gov.au/publications/rdp/2000/2000-05/appendix-b.html

Introduction

1 Jun 2000 RDP 2000-05
Meredith Beechey, Nargis Bharucha, Adam Cagliarini, David Gruen and Christopher Thompson
It is primarily of interest for examining macroeconomic developments – including the effects of monetary policy on the economy – over the short to medium run; that is, for perhaps one to three ... The model consists of five estimated equations. Two
https://www.rba.gov.au/publications/rdp/2000/2000-05/introduction.html

References

1 Jun 2000 RDP 2000-05
Meredith Beechey, Nargis Bharucha, Adam Cagliarini, David Gruen and Christopher Thompson
Gruen DWR and J Wilkinson (1991), ‘Australia's Real Exchange Rate: Is it Explained by the Terms of Trade or by Real Interest Differentials?’, Reserve Bank of Australia Research Discussion Paper ... Lowe PW and L Ellis (1997), ‘The Smoothing of
https://www.rba.gov.au/publications/rdp/2000/2000-05/references.html