2  BIS Review 39/2001  This is a misguided notion, however, as the Reserve Bank realises that buying US dollars from the market, as and when conditions permit, has achieved what could reasonably be expected. Our policy position is that we will continue to work the NOFP down as and when economic and financial conditions are favourable.
These purchases have greatly expanded the size and lengthened the maturity of the assets on the Fed’s balance sheet. The Fed is also using forward guidance as a policy tool, which is intended to inform the public about the way monetary policy is likely to evolve in the future.