Questions tagged [reserve-requirement-ratio]

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How does the Federal Reserve reduce “excess reserves”?

Over the last few years, the amount of currency is circulation (and the corresponding liability on the Fed's balance sheet) has been growing; however, the asset side of the BS hasn't increased. By ...
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Can a bank have deposits at another bank?

Can a bank create an account at another bank and get a loan in the form of deposits at that bank? If so, could these deposits at the other bank be used to satisfy the first bank's reserve/liquidity ...
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Why does the Fed not fiddle with the reserve ratio?

We often hear in the news of the Fed changing the interest rate. Why do they not commonly alter the reserve ratio? Won't either be capable of expanding or contracting the money supply?
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What physically happens when foreign currency reserves change?

Assume that the United States decided to hold more yuan in the federal reserve. Which processes does that involve? I assume there is some sort of electronic exchange between the two central banks ...