APRA and the RBA release joint statement on the use of the RBA’s overnight standing facility

The Australian Prudential Regulation Authority (APRA) and the Reserve Bank of Australia (RBA) have published a joint statement on the use of the RBA’s overnight standing facility. 

The RBA has recently announced some important updates to its new approach to monetary policy implementation – the ‘ample reserves with full allotment’ system - including the configuration of its open market operations and the role of the overnight standing facility. These facilities will play an important role to supply reserves needed to keep the cash rate close to its target.

APRA and the RBA consider the use of the overnight standing facility by banks to be consistent with routine liquidity management activities. Both agencies are comfortable with banks using the facility as needed. APRA and the RBA will liaise with banks to ensure that they understand the role of the overnight standing facility and are ready to use it and comfortable doing so in their liquidity management practices.

The joint statement is available on the APRA website at: Joint APRA-RBA Statement on Use of the RBA’s overnight standing facility.