In the latest of a series of reports on central bank policy, News.org.au is publishing the latest update on central banks interest rate decisions, including a look at the central bank’s policy decision to raise the federal government’s lending limit by 25 basis points.
Central banks interest rates are the interest rate paid on the central banks own money by the Government on deposits.
They are set at a set rate per unit of value.
In this case, the federal Government’s $1.9 trillion loan to the states and territories is a central bank rate.
The rate has risen by 1.5 basis points this month as it looks to ensure the money supply remains relatively stable.
The Reserve Bank of Australia (RBA) has set the rate at a range of 1.25 to 1.50 per cent, and the Bank of England (BoE) has a range between 1.0 per cent and 1.15 per cent.
In the latest decision, the RBA raised the rate by 25.5 bps to 1 1/2 per cent effective from April 30, 2016.
It is expected the RBNZ will be able to borrow more in the future.
“The RBA’s decision to move the Reserve Bank’s benchmark interest rate by the same amount as the BoE’s rate for a fourth time to 1 per cent on deposits will ensure the Government’s financial position is not materially affected,” the RBRA said in a statement on Tuesday.
The RBNA has a number of policy levers it can use to keep interest rates low and stimulate the economy.
The central bank can buy government bonds in the market to raise its own cash.
It can also buy more bonds to support its own asset base, which can boost economic growth.
The Federal Government has also been using its $2.2 trillion of mortgage loans to shore up the economy, and has been keeping interest rates at zero for the past four years.
“We will continue to monitor the Reserve’s policy decisions, and will make further announcements on monetary policy when appropriate,” the BoJ said in the statement.
Topics:money-and-monetary-policy,economics-and/or-finance,state-government,state—organisations,government-and.parliament,parliament-house-2900,nsw,australiaFirst posted March 04, 2018 12:47:18Contact Emily BoddingtonMore stories from New South Wales