Sentences with phrase «interest on bank reserve deposits»

Factors such as the Fed choosing to pay interest on bank reserve deposits, the large cash holdings of big firms, and the persistent regime uncertainty that makes lending / investing seem particularly risky these days can together explain the reluctance of the banks to turn the monetary base into money via the multiplier process.

Not exact matches

In addition, the Federal Reserve developed a term deposit facility to drain banks» reserve balances.14 This playbook of draining reserves back to reserve scarcity to support the transmission of interest on reserves into market rates is standard among central banks.

Instead, when the Fed makes its first rate hike — something that probably won't happen until at least September - 2015 — it will do so by 1) raising the interest rate paid on bank reserves, 2) increasing the amount that it pays to borrow money via Reverse Repurchase agreements, and 3) boosting the rate that it offers to financial institutions for term deposits.

The term of the deposit is currently up to 21 days and the interest rate paid is slightly above the rate paid on bank reserves.

These include changing bank reserve requirements by making them higher or lower, changing the terms on which it lends to banks through its discount window, and changing the rate of interest it pays on the bank reserves it has on deposit.

These include changing bank reserve requirements by making them higher or lower, changing the terms on which it lends to banks through its discount window, and changing the rate of interest it pays on the bank reserves it has on deposit.