- "Reserve requirements are central bank regulations that set the minimum amount that a commercial bank must hold in liquid assets."
Explanation of how central banks require banks to hold a certain amount of reserves and how this affects the money supply.
- "This minimum amount, commonly referred to as the commercial bank's reserve, is generally determined by the central bank on the basis of a specified proportion of deposit liabilities of the bank."
- "The commercial bank's reserves normally consist of cash held by the bank and stored physically in the bank vault (vault cash), plus the amount of the bank's balance in that bank's account with the central bank."
- "A bank is at liberty to hold in reserve sums above this minimum requirement, commonly referred to as excess reserves."
- "The reserve ratio is sometimes used by a country’s monetary authority as a tool in monetary policy, to influence the country's money supply by limiting or expanding the amount of lending by the banks."
- "Monetary authorities increase the reserve requirement only after careful consideration because an abrupt change may cause liquidity problems for banks with low excess reserves."
- "They generally prefer to use other monetary policy instruments to implement their monetary policy."
- "In many countries (except Brazil, China, India, Russia), reserve requirements are generally not altered frequently in implementing a country's monetary policy because of the short-term disruptive effect on financial markets."
- "In several countries, including the United States, there are today zero reserve requirements."
- "An abrupt change may cause liquidity problems for banks with low excess reserves."
- "Except Brazil, China, India, Russia, reserve requirements are generally not altered frequently in implementing a country's monetary policy because of the short-term disruptive effect on financial markets."
- "Reserve requirements are central bank regulations that set the minimum amount that a commercial bank must hold in liquid assets."
- "This minimum amount... is generally determined by the central bank on the basis of a specified proportion of deposit liabilities of the bank."
- "The commercial bank's reserves normally consist of cash held by the bank and stored physically in the bank vault (vault cash), plus the amount of the bank's balance in that bank's account with the central bank."
- "A bank is at liberty to hold in reserve sums above this minimum requirement, commonly referred to as excess reserves."
- "The reserve ratio is sometimes used by a country's monetary authority as a tool in monetary policy, to influence the country's money supply by limiting or expanding the amount of lending by the banks."
- "They generally prefer to use other monetary policy instruments to implement their monetary policy."
- "In many countries (except Brazil, China, India, Russia), reserve requirements are generally not altered frequently in implementing a country's monetary policy because of the short-term disruptive effect on financial markets."
- "In several countries, including the United States, there are today zero reserve requirements."
- "An abrupt change may cause liquidity problems for banks with low excess reserves."