The Reserve Bank decided to supply more than the usual $ million of exchange settlement funds, so that the overnight interest rate would not rise above the target set by the Board in early August. Those operations were successful in maintaining the cash rate at the 6.5 per cent target, though other short-term market interest rates remained unusually elevated.
Since then, the Bank has continued to supply whatever amounts of exchange settlement balances were necessary to keep the cash rate at the target. In the process, balances rose to a peak of $ billion in the middle of last week, the highest level for some years, though some of this has been reversed recently.