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Which of the following is not used as an instrument or tool for conducting monetary policy in Australia?Group of answer choicescash (interbank) marketreserve deposit ratioopen market operationcash rate

Question

Which of the following is not used as an instrument or tool for conducting monetary policy in Australia?Group of answer choicescash (interbank) marketreserve deposit ratioopen market operationcash rate

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Solution

The Reserve Deposit Ratio is not used as an instrument or tool for conducting monetary policy in Australia. The Reserve Bank of Australia (RBA) uses the cash rate (interbank lending rate), open market operations, and the cash (interbank) market as its main tools for implementing monetary policy. The Reserve Deposit Ratio is not a tool that the RBA uses.

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