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Reserve Bank of Australia

The Reserve Bank of Australia (RBA) came into being on 14 January 1960 as Australia's central bank and banknote issuing authority, when the Reserve Bank Act 1959 removed the central banking functions from the Commonwealth Bank. The bank has the responsibility of providing services to the Government of Australia in addition to also providing services to other central banks and official institutions. It currently consists of the Payments System Board, which governs the payments system policy of the bank, and the Reserve Bank Board, which governs all other monetary and banking policies of the bank.

Articles by Reserve Bank of Australia

Robust Fallbacks Required for BBSW Securities

10 days ago

The Reserve Bank is introducing new eligibility criteria for securities to be accepted as collateral in
the Reserve Bank’s market operations.
Floating rate notes (FRNs) and marketed asset-backed securities issued on or after 1 December
2022 that reference BBSW must include robust fallback provisions
All self-securitisations, regardless of the date of issue, must include robust fallback provisions.
The Reserve Bank will engage directly with self-securitisation issuers and give at least
12 months’ notice before enforcing this requirement.
Eligibility criteria for FRNs and marketed asset-backed securities issued before 1 December 2022
are unchanged. However, issuers should strongly consider including robust fallbacks for such securities,

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Statement by Philip Lowe, Governor: Monetary Policy Decision

16 days ago

At its meeting today, the Board decided to:
maintain the cash rate target at 10 basis points and the interest rate on Exchange Settlement
balances of zero per cent
maintain the target of 10 basis points for the April 2024 Australian Government bond
purchase government securities at the rate of $4 billion a week and to continue the purchases at
this rate until at least mid February 2022.
Prior to the Delta outbreak the Australian economy had considerable momentum. GDP increased by
0.7 per cent in the June quarter and by nearly 10 per cent over the year. Business
investment was picking up and the labour market had strengthened. The unemployment rate had fallen below
5 per cent and job vacancies were at a high level.

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BIS Innovation Hub and central banks of Australia, Malaysia, Singapore and South Africa will test CBDCs for international settlements

21 days ago

Project Dunbar will develop prototypes for shared platforms that will enable international
settlements with digital currencies issued by multiple central banks.

System aims to allow direct transactions between institutions, reducing costs and increasing speed.

Results will inform development of global and regional platforms and support G20 roadmap for
improving cross-border payments.

The Bank for International Settlements Innovation Hub, the Reserve Bank of Australia, Bank Negara
Malaysia, Monetary Authority of Singapore, and South African Reserve Bank will join forces to test the
use of central bank digital currencies (CBDCs) for international settlements.

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Update on the Independent Expert Review of November’s ASX Trade Outage

August 22, 2021

The Australian Securities and Investments Commission (ASIC) and the Reserve Bank of Australia (RBA)
(the regulators) are today publishing a summary of an independent expert review of the ASX Trade Refresh
project (see 21-220MR). The review was conducted by IBM Australia Limited.
On 16 November 2020, an outage occurred shortly after a major upgrade to ASX’s equity trading
platform, ASX Trade. The regulators view operational incidents of this nature with significant concern.
To examine the issues, the regulators informed ASX of their expectation that an independent review of
the ASX Trade Refresh project be conducted in the first half of 2021.
The purpose of the independent expert review was to examine the project and assess whether it met

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Payments System Board Update: August 2021 Meeting

August 20, 2021

At its meeting today, the Payments System Board discussed a number of issues, including:

The Bank’s Review of Retail Payments Regulation. The Board reviewed responses to the Consultation
Paper published in May, particularly relating to dual-network debit cards and least-cost routing,
interchange fees and the ‘no-surcharge’ rules of buy now, pay later providers. The Board
expects to publish a Conclusions Paper and final Standards within the next 2 months. Members
noted in their discussion that new technologies are making the payments landscape more complicated
and the Bank’s powers to deal with some issues were limited. A number of these issues have been
raised in the Bank’s submission to the Treasury’s Review of

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26th Executives’ Meeting of East Asia-Pacific Central Banks (EMEAP) Governors’ Meeting

August 12, 2021

The 26th EMEAP[1] Governors’ Meeting was held via video conference on 12 August 2021.
The meeting was attended by Governors of EMEAP member central banks and monetary authorities, as well as
senior representatives from the International Monetary Fund and the Board of Governors of the Federal
Reserve System. The meeting was hosted by Philip Lowe, Governor of the Reserve Bank of Australia, as
this year’s Chair of the EMEAP Governors’ Meeting.
Governors discussed the asynchronous nature of the global recovery and the implications for economic
policy. They exchanged views on recent COVID-19 outbreaks and developments
in financial conditions. Members also discussed the extent of inflation pressures across the region and
whether those pressures

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Statement by Philip Lowe, Governor: Monetary Policy Decision

August 3, 2021

At its meeting today, the Board decided to:
maintain the cash rate target at 10 basis points and the interest rate on Exchange Settlement
balances of zero per cent
maintain the target of 10 basis points for the April 2024 Australian Government bond
continue to purchase government securities at the rate of $5 billion a week until early
September and then $4 billion a week until at least mid November.
The economic recovery in Australia has been stronger than was earlier expected. The recent outbreaks of
the virus are, however, interrupting the recovery and GDP is expected to decline in the September
quarter. The experience to date has been that once virus outbreaks are contained, the economy bounces
back quickly. Prior to

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Statement by Philip Lowe, Governor: Monetary Policy Decision

July 6, 2021

At its meeting today, the Board decided to:
retain the April 2024 bond as the bond for the yield target and retain the target of 10 basis
points
continue purchasing government bonds after the completion of the current bond purchase program in
early September. These purchases will be at the rate of $4 billion a week until at least mid
November
maintain the cash rate target at 10 basis points and the interest rate on Exchange Settlement
balances of zero per cent.
These measures will provide the continuing monetary support that the economy needs as it transitions
from the recovery phase to the expansion phase. The Board is committed to achieving the goals of full
employment and inflation consistent with the target. Today’s decisions, together

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Reserve Bank Welcomes Digital Finance Cooperative Research Centre Announcement

June 30, 2021

The Reserve Bank has welcomed the announcement that the Digital Finance Cooperative Research Centre
(CRC) has been selected to receive funding under the CRC Program administered by the Ministry of
Industry, Science and Technology. The program provides funding for medium- to long-term, industry-led
research collaborations. The Reserve Bank is participating in the Digital Finance CRC as part of work on
the Bank’s strategic focus area of supporting the evolution of payments.
The Digital Finance CRC brings together more than 20 organisations in the finance industry,
ranging from recently established fintechs to large established organisations including the Reserve
Bank, as well as academics from numerous Australian universities. It has been

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Assessment of the Reserve Bank Information and Transfer System

June 16, 2021

The Bank today released the 2021 Assessment of the Reserve Bank Information and Transfer System (RITS)
against the Principles for Financial Market Infrastructures (PFMI). The Assessment concludes that RITS
‘observed’ all relevant Principles as at 31 March 2021, except for the Principles on
Participant-Default Rules and Procedures, and on Operational Risk, which were rated as ‘broadly
observed’.
RITS is Australia’s high-value payments system, which is used by banks and other approved
institutions to settle their payment obligations on a real-time gross settlement basis. The
Assessment was independently prepared by the Bank’s Payments Policy Department and approved by the
Payments System Board.
The Assessment discusses work underway to support the

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Regulators expect Australian institutions to cease the use of LIBOR in new contracts before the end of 2021

June 3, 2021

Regulators in Australia are reiterating the importance of ensuring a timely transition away from the
London Interbank Offered Rate (LIBOR). This requires ceasing the use of LIBOR in new contracts before
the end of 2021.
On 2 June 2021, the Financial Stability Board (FSB) announced that all new use of LIBOR benchmarks
should cease as soon as practicable and no later than the timelines set out by home authorities and/or
national working groups in the relevant currencies. In particular, even though some USD LIBORs will
continue until mid-2023, the US Banking Supervisors have stated that firms should cease entering into
new contracts that use USD LIBOR as a reference rate as soon as practicable and in any event

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Statement by Philip Lowe, Governor: Monetary Policy Decision

June 1, 2021

At its meeting today, the Board decided to maintain the current policy settings, including: the targets
of 10 basis points for the cash rate and the yield on the 3-year Australian Government bond; the
parameters of the government bond purchase program; and the rate of zero per cent on Exchange
Settlement balances.
The global economy is continuing to recover from the pandemic and the outlook is for strong growth this
year and next. The recovery remains uneven, though, and some countries are yet to contain the virus.
Global trade in goods has picked up strongly and commodity prices are mostly higher than at the start of
the year. However, inflation in underlying terms remains low and below central bank targets.

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Consultation on Preliminary Conclusions to the Review of Retail Payments Regulation

May 28, 2021

At its meeting on 21 May, the Payments System Board approved a consultation on a proposed package of policy actions related to the Bank’s retail payments regulation. The Bank has today released a
Consultation Paper setting out the proposed policy actions, together with draft variations to the
standards for card payment systems. This follows extensive stakeholder consultation by the Bank on the
matters raised in the Issues
Paper for the review, which was published in November 2019.

In general, the Board is not proposing major reforms to the Bank’s retail payments regulation.
Australia’s payments system is in most regards providing high-quality services for Australian
households,

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Payments System Board Update: May 2021 Meeting

May 21, 2021

At its meeting today, the Payments System Board discussed a number of issues, including:
The Bank’s Review of Retail Payments Regulation. The Board discussed and approved a consultation
paper seeking stakeholder views on the preliminary conclusions to the Review. The Bank expects to
release this paper, including draft revisions to the Bank’s standards, within the next two
weeks.
The Bank’s assessment of Australia’s real-time gross settlement system – the Reserve
Bank Information and Transfer System (RITS) – against the relevant international standards. The
Board approved the assessment, which the Bank will publish in coming weeks.
Financial market infrastructure (FMI) regulatory reforms. The Board welcomed the Government’s
plans to

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Statement by Philip Lowe, Governor: Monetary Policy Decision

May 4, 2021

At its meeting today, the Board decided to maintain the current policy settings, including the targets
of 10 basis points for the cash rate and the yield on the 3-year Australian Government bond, as
well as the parameters of the Term Funding Facility and the government bond purchase program.
The global economy is continuing to recover from the pandemic and the outlook is for strong growth this
year and next. The recovery remains uneven, though, and some countries are yet to contain the virus.
Global trade in goods has picked up strongly and commodity prices are mostly higher than at the start of
the year. However, inflation remains low and below central bank targets.
Sovereign bond yields have been steady recently

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Reserve Bank of Australia Becomes Inaugural Member of New, International Central Bank Network for Indigenous Inclusion

April 27, 2021

Joint statement from Te Pūtea Matua (Reserve Bank of New Zealand), the Bank of Canada and
the Reserve Bank of Australia.
Along with Indigenous partners, Te Pūtea Matua (Reserve Bank of New Zealand), the Bank of Canada
and the Reserve Bank of Australia have formed a voluntary network to foster ongoing dialogue and raise
awareness of Indigenous economic and financial issues.
The Central Bank Network for Indigenous Inclusion, established 1 January 2021, aims to share
knowledge and best practices, promote engagement with Indigenous Peoples, and foster greater
understanding and education about Indigenous economic issues and histories.
The network will focus on:
Conducting research for and with Indigenous peoples on economic issues, including the

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Statement by Philip Lowe, Governor: Monetary Policy Decision

April 6, 2021

At its meeting today, the Board decided to maintain the current policy settings, including the targets
of 10 basis points for the cash rate and the yield on the 3-year Australian Government bond, as
well as the parameters of the Term Funding Facility and the government bond purchase program.
The rollout of vaccines is supporting the recovery of the global economy, although the recovery is
uneven. While there are still considerable uncertainties regarding the outlook, the central case has
improved. Global trade has picked up and commodity prices are mostly higher than at the start of the
year. Inflation remains low and below central bank targets.
Sovereign bond yields have increased over recent months due to the

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Statement by Philip Lowe, Governor: Monetary Policy Decision

March 2, 2021

At its meeting today, the Board decided to maintain the current policy settings, including the targets
of 10 basis points for the cash rate and the yield on the 3-year Australian Government bond, as
well as the parameters of the Term Funding Facility and the government bond purchase program.
The outlook for the global economy has improved over recent months due to the ongoing rollout of
vaccines. While the path ahead is likely to remain bumpy and uneven, there are better prospects for a
sustained recovery than there were a few months ago. Global trade has picked up and commodity prices
have increased over recent months. Even so, the recovery remains dependent on the health situation and
on significant fiscal and

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Payments System Board Update: February 2021 Meeting

February 19, 2021

At its meeting today, the Payments System Board discussed a number of issues, including:
The Bank’s Review of Retail Payments Regulation. The Board discussed some recent industry
developments that are relevant to the Review, particularly relating to dual-network debit cards,
least-cost routing, and scheme fees. The staff are continuing to gather information and consulting with
stakeholders. It is expected that the Board will agree on draft conclusions for the Review at its May
meeting, for publication soon afterwards.
Cyber risks to the Australian payments system. Members were briefed on the work being undertaken by
the Bank (together with other CFR agencies) to oversee the management of cyber security risks in the
financial sector. They

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Statement by Philip Lowe, Governor: Monetary Policy Decision

February 2, 2021

At its meeting today, the Board decided to maintain the targets of 10 basis points for the cash
rate and the yield on the 3-year Australian Government bond, as well as the parameters of the Term
Funding Facility. It also decided to purchase an additional $100 billion of bonds issued by the
Australian Government and states and territories when the current bond purchase program is completed in
mid April. These additional purchases will be at the current rate of $5 billion a week.
The outlook for the global economy has improved over recent months due to the development of vaccines.
While the path ahead is likely to remain bumpy and uneven, there are better prospects for a sustained
recovery than there were a few months ago. That recovery, however, remains

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Appointment of Assistant Governor, Business Services

December 10, 2020

The Governor, Philip Lowe, is pleased to announce the appointment of Michelle McPhee to the position of
Assistant Governor (Business Services) at the Reserve Bank of Australia. The Bank considered a
competitive field of internal and external candidates for the role, which will become vacant on the
retirement of Lindsay Boulton in February 2021.

Ms McPhee is currently the Head of Banking at the Reserve Bank of Australia, a role she has held for
the last four years. She spent six years as the Head of Risk and Compliance and, prior to that, held a
number of senior management positions at the Bank primarily in financial market operations. She is
currently a non-executive director of the Australian Payments Network, deputy chair of

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Statement by Philip Lowe, Governor: Monetary Policy Decision

December 1, 2020

At its meeting today, the Board decided to maintain the current policy settings, including the targets
of 10 basis points for the cash rate and the yield on 3-year Australian Government bonds, as well
as the parameters of the Term Funding Facility and the government bond purchase program.
Globally, the news has been mixed recently. On the one hand, infection rates have risen sharply in
Europe and the United States and the recoveries in these economies have lost momentum. On the other
hand, there has been positive news on the vaccine front, which should support the recovery of the global
economy. The recovery is also dependent on ongoing support from both fiscal and monetary policy. Hours
worked in most countries remain noticeably below

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South Pacific Central Bank Governors Committed to Cost Effective Remittances

November 20, 2020

At the South Pacific Central Bank Governors’ Meeting on 17–18 November 2020, the South
Pacific Governors[1] agreed that access to cost-effective remittances remains a high priority focus for the
region.
A key focus has been their collective effort to develop a regional ‘Know Your Customer’
(KYC)[2] facility. The central banks, with support from the International Monetary Fund and other
international agencies, have successfully completed an initial phase of work on a KYC facility for the
South Pacific region.
Simeon Malachi Athy, Governor of the Reserve Bank of Vanuatu and host of the Meeting, said, ‘The
intention of the facility is to improve customer due diligence processes and Anti-Money Laundering /
Countering Financing of Terrorism (AML/CFT)

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Committed Liquidity Facility

November 20, 2020

Following a review, the Reserve Bank has assessed that Authorised Deposit-taking Institutions (ADIs)
using the Committed Liquidity Facility (CLF) can increase their reasonable holdings of high-quality
liquid assets (HQLA) from 26 to 27 per cent of the stock of HQLA securities by the end of
2020, and to 30 per cent of the stock of HQLA securities by the end of 2021. This assessment
reflects the increase in issuance of HQLA securities in 2020 and in prospect for 2021.[1]
As previously announced following the 2019 review of the
CLF, on 1 January 2021 the CLF fee will increase from 17 to 20 basis points per annum on the size of the
commitment to each ADI. The fee is set so that ADIs face similar financial
incentives to meet their liquidity

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Statement by Philip Lowe, Governor: Monetary Policy Decision

November 3, 2020

At its meeting today, the Board decided on a package of further measures to support job creation and
the recovery of the Australian economy from the pandemic. With Australia facing a period of high
unemployment, the Reserve Bank is committed to doing what it can to support the creation of jobs.
Encouragingly, the recent economic data have been a bit better than expected and the near-term outlook
is better than it was three months ago. Even so, the recovery is still expected to be bumpy and drawn
out and the outlook remains dependent on successful containment of the virus.
The elements of today’s package are as follows:
a reduction in the cash rate target to 0.1 per cent
a reduction in the target for the yield on the 3-year Australian Government

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Reserve Bank partners with Commonwealth Bank, National Australia Bank, Perpetual and ConsenSys Software on Wholesale Central Bank Digital Currency Research Project

November 1, 2020

The Reserve Bank today announced that it is partnering with Commonwealth Bank, National Australia Bank,
Perpetual and ConsenSys Software, a blockchain technology company, on a collaborative project to explore
the potential use and implications of a wholesale form of central bank digital currency (CBDC) using
distributed ledger technology (DLT). This is part of ongoing research at the Reserve Bank on wholesale
CBDC.
The project will involve the development of a proof-of-concept (POC) for the issuance of a tokenised
form of CBDC that can be used by wholesale market participants for the funding, settlement and repayment
of a tokenised syndicated loan on an Ethereum-based DLT platform. The POC will be used to explore the
implications of ‘atomic’

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Next Generation of Banknotes: $100 Enters General Circulation

October 28, 2020

The new $100 banknote enters general circulation today. It is the final denomination
to be
redesigned as part of the Reserve Bank’s Next Generation Banknote Program.

Governor Philip Lowe said, ‘The release of the new $100 marks the completion
of the
decade-long program to upgrade the security of our banknotes. As a result, Australia
continues to have
some of the best and most secure banknotes in the world. We also continue to celebrate
the outstanding
contributions of two well-known Australians, Sir John Monash and Dame Nellie Melba, on
the new
$100.’

Sir John Monash was an engineer, soldier and civic leader recognised for his influence in
the

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Regulators urge Australian institutions to adhere to the ISDA IBOR Fallbacks Protocol and Supplement

October 13, 2020

Regulators and industry are taking further steps to transition away from LIBOR, which is expected to
cease after the end of 2021. In particular, on Friday 9 October 2020 the International Swaps and
Derivatives Association (ISDA) announced that it will launch the 2020 IBOR Fallbacks Protocol and
associated Supplement to the 2006 ISDA Definitions on 23 October 2020. These are needed to
implement robust fall-back provisions for derivative contracts referencing key interbank offered rates
(IBORs), including the London Interbank Offered Rate (LIBOR). The protocol and supplement are informed
by extensive consultation with industry, including in Australia.

While the regulators welcome the

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Statement by Philip Lowe, Governor: Monetary Policy Decision

October 6, 2020

At its meeting today, the Board decided to maintain the current policy settings, including the targets
for the cash rate, the yield on 3-year Australian Government bonds, and the parameters for the expanded
Term Funding Facility.
The global economy is gradually recovering after a severe contraction due to the pandemic. However, the
recovery is uneven and its continuation is dependent on containment of the virus. While infection rates
have declined in some countries, they have increased in others. The recovery is most advanced in China,
where conditions have improved substantially over recent months. Globally, inflation remains very low
and below central bank targets.
Financial conditions remain accommodative around the world and supportive of

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