Research Discussion Paper – RDP 2024-08 Modelling Reserve Demand with Deposits and the Cost of Collateral

Contents

• Introduction
• Background
• Literature Review
• Sources of Reserve Demand
• Data
• Model
• Results
• Discussion
• Appendix A: Repo Rate Calculation
• Appendix B: Robustness Tests
• References

I would like to thank Bill Nelson, Dmitry Titkov, Richard Finlay, Anthony Brassil, Duke Cole, Gian-piero Lovicu, David Jacobs, Christopher Kent, Sean Dowling, Matthew Read, Jeremy Gehrig, Fabio Rustia, Jon Cheshire, Callum Ryan and participants in internal Reserve Bank seminars for helpful comments and suggestions. The views expressed in this paper are my own and do not necessarily reflect the view of the Reserve Bank of Australia. I am solely responsible for any errors.