Sentences with phrase «excess reserves reduces»

First, the abundance of excess reserves reduces banks» need to seek liquidity through repo.

Not exact matches

«The concern now is that the Fed may run out of Treasuries» During 1936 - 1937 the reserve authorities raised the reserve ratios in an effort to reduce the huge volume of excess reserves in the member banks, while at the same timer being forced to continue purchasing operations in order to assist the treasury inn its deficit financing.

However, the decision at each of the April meetings to maintain the current policy stance — expressed as a target for banks» excess reserves — was not unanimous, adding to speculation that the target may be reduced over coming months.

By paying interest on reserves, central banks can raise rates as required to prevent inflation without reducing their balance sheets and shrinking the excess reserves of member banks.

«The concern now is that the Fed may run out of Treasuries» During 1936 - 1937 the reserve authorities raised the reserve ratios in an effort to reduce the huge volume of excess reserves in the member banks, while at the same timer being forced to continue purchasing operations in order to assist the treasury inn its deficit financing.

Initially, the expansion of Federal Reserve credit was financed by reducing the Federal Reserve's holdings of Treasury securities, in order to avoid an increase in bank reserves that would drive the federal funds rate below its target as banks sought to lend out their excess reserves.

By January 2015, when FHA reduced the MIP by more than 35 percent, the excess reserve was back above 2 percent.