Reserve Bank of Australia Primary purpose is the overall management of the financial sector in...
-
Upload
angela-ryan -
Category
Documents
-
view
214 -
download
0
Transcript of Reserve Bank of Australia Primary purpose is the overall management of the financial sector in...
![Page 1: Reserve Bank of Australia Primary purpose is the overall management of the financial sector in accordance with the economic objectives of the Commonwealth.](https://reader036.fdocuments.us/reader036/viewer/2022082713/5697c0091a28abf838cc7318/html5/thumbnails/1.jpg)
Reserve Bank of Australia
• Primary purpose is the overall management of the financial sector in accordance with the economic objectives of the Commonwealth Government.
• Created in 1959 under the Reserve Bank Act 1959
![Page 2: Reserve Bank of Australia Primary purpose is the overall management of the financial sector in accordance with the economic objectives of the Commonwealth.](https://reader036.fdocuments.us/reader036/viewer/2022082713/5697c0091a28abf838cc7318/html5/thumbnails/2.jpg)
Three broad objectives
• Stability of Australia’s currency
• Maintenance of full employment
• Economic prosperity and welfare of the people of Australia
![Page 3: Reserve Bank of Australia Primary purpose is the overall management of the financial sector in accordance with the economic objectives of the Commonwealth.](https://reader036.fdocuments.us/reader036/viewer/2022082713/5697c0091a28abf838cc7318/html5/thumbnails/3.jpg)
Conducting monetary policy (on behalf of Big Kev!...and his friends)
• Monetary Policy is most important ongoing responsibility
• Monetary Policy is Reserve Bank action designed to influence the cost and availability of money in the Australian economy through influencing general level of interest rates
![Page 4: Reserve Bank of Australia Primary purpose is the overall management of the financial sector in accordance with the economic objectives of the Commonwealth.](https://reader036.fdocuments.us/reader036/viewer/2022082713/5697c0091a28abf838cc7318/html5/thumbnails/4.jpg)
Cash Rate and Money Supply
Cash Rate D S
![Page 5: Reserve Bank of Australia Primary purpose is the overall management of the financial sector in accordance with the economic objectives of the Commonwealth.](https://reader036.fdocuments.us/reader036/viewer/2022082713/5697c0091a28abf838cc7318/html5/thumbnails/5.jpg)
Cash Rate and Money Supply
Cash Rate D S
Cash rate > Money Supply
![Page 6: Reserve Bank of Australia Primary purpose is the overall management of the financial sector in accordance with the economic objectives of the Commonwealth.](https://reader036.fdocuments.us/reader036/viewer/2022082713/5697c0091a28abf838cc7318/html5/thumbnails/6.jpg)
Control of Note Issue
• Sole issuing authority
• All currency is manufactured by a division of the RBA known as Note Printing Australia
• Volume of physical currency varies depending on the time of year (eg more at Christmas)
![Page 7: Reserve Bank of Australia Primary purpose is the overall management of the financial sector in accordance with the economic objectives of the Commonwealth.](https://reader036.fdocuments.us/reader036/viewer/2022082713/5697c0091a28abf838cc7318/html5/thumbnails/7.jpg)
Regulation of the Payments System
• Ensuring the efficiency and stability of the payment methods such as credit cards, electronic cash, traveller’s cheques and stored-value cards
![Page 8: Reserve Bank of Australia Primary purpose is the overall management of the financial sector in accordance with the economic objectives of the Commonwealth.](https://reader036.fdocuments.us/reader036/viewer/2022082713/5697c0091a28abf838cc7318/html5/thumbnails/8.jpg)
Banker to the Banks
• Holds exchange accounts between banks to settle debts between them
• Used by banks to buy and sell Government securities
![Page 9: Reserve Bank of Australia Primary purpose is the overall management of the financial sector in accordance with the economic objectives of the Commonwealth.](https://reader036.fdocuments.us/reader036/viewer/2022082713/5697c0091a28abf838cc7318/html5/thumbnails/9.jpg)
Holds Australia’s reserves of gold and foreign currency
• Provides funds that can be used to make international payments or RBA functions with the foreign exchange market
• Overseas dealers in the foreign exchange market
![Page 10: Reserve Bank of Australia Primary purpose is the overall management of the financial sector in accordance with the economic objectives of the Commonwealth.](https://reader036.fdocuments.us/reader036/viewer/2022082713/5697c0091a28abf838cc7318/html5/thumbnails/10.jpg)
Banker and Advisor to Govt
• Provides banking and financial agency services to the Comm Govt & some state govts.
• Govt can lodge funds with the RBA through the issue of Treasury Bills – which leads to the RBA printing the currency it needs