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excess reserves

   Also found in: Wikipedia 0.04 sec.
Excess reserves
Amount of reserves held by an institution in excess of its reserve requirement and required clearing balance. Also see reserves.
Excess reserves
Actual reserves that exceed required reserves.
excess reserves
The reserves held by banks and thrifts in excess of what is required by the Federal Reserve. Large excess reserves indicate a potential for credit expansion and reduced interest rates that could prove beneficial to the security markets. Conversely, small excess reserves indicate reduced possibilities for credit expansion and a relatively tight monetary policy by the Federal Reserve. Compare required reserves.


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Depositories would need to hold higher levels of excess reserves at Federal Reserve Banks as a precaution against such overdrafts, and demand for these excesses would vary from day to day and be difficult to predict.
Testimony of Federal Reserve Officials by Federal Reserve Bulletin
He discussed the Fed's attempt to lower interest rates by pumping excess reserves in the banking system: ``The excess credit, which the Fed pumped into the economy spilled over into the stock market - triggering a fantastic speculative boom.
FED'S MONEY TINKERING CREATED MARKET BOOM; CENTRAL BANK PUMPED EXCESS ... by Daily News (Los Angeles, CA)
For example, when the Bank of Japan wishes to tighten, it withdraws excess reserves at a rate faster than is usually the case.
Japanese Monetary Policy by Dekle, Robert / Pacific Affairs
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