Voluntary reserve targets can aid transmission – Fed paper


Using voluntary reserve targets (VRT) rather than required reserves could help to promote monetary policy transmission, according to a working paper published by the Federal Reserve.

Under VRT, banks are asked to commit to voluntary targets for deposits held with the central bank. By setting interest rates based on the targets, the central bank can encourage positive reserves balances. The system was first trialled by the Bank of England and is now under consideration at the Fed, say authors

Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.

To access these options, along with all other subscription benefits, please contact [email protected] or view our subscription options here: http://subscriptions.centralbanking.com/subscribe

You are currently unable to copy this content. Please contact [email protected] to find out more.

To continue reading...

You need to sign in to use this feature. If you don’t have a Central Banking account, please register for a trial.

Sign in
You are currently on corporate access.

To use this feature you will need an individual account. If you have one already please sign in.

Sign in.

Alternatively you can request an individual account here: