The balance sheet has nearly doubled from $ billion to $ billion, which is a substantial easing in monetary policy. In many ways, these actions are as stimulatory as a quantitative easing program of the same size. They are providing substantial liquidity to Australian financial markets and underpinning the historically low level of interest rates.
In my presentation, I will address the following questions: Why is monetary policy operating procedure important? How do major central banks operate their monetary policy? What is the Reserve Bank’s monetary policy operating framework? How effective is the Reserve Bank’s monetary operating framework? I will conclude by highlighting some challenges in the operations of monetary policy on the way forward.