As of October 9, the Federal reserve began paying interest on excess and required reserves.
It is mainly reflected that required reserve demand has an impact on interbank payment flow.
Raising required reserve ratio is concrete manifestation of reserve requirement system, and the People's Bank of China aims at regulating China's money supply through this vehicle.
And on Monday, the Fed said it would begin to pay interest on Banks' excess reserves and required reserve requirements.
Since January 2010, the required reserve ratio and benchmark deposit and lending rates have been raised 12 times and four times respectively.
The deposit expansion factor for a given amount of new reserves isthus the reciprocal of the required reserve percentage (1/.10 = 10).
to deposit required reserves
