Reserve Requirement
/ˈrɛzɜrv rɪˈkwaɪərmənt/
Definitions
- (n.) A regulatory mandate requiring banks to hold a minimum amount of reserves against deposit liabilities to ensure liquidity and stability.
The central bank increased the reserve requirement to control inflation.
Forms
- reserve requirement
- reserve requirements
Related terms
See also
Commentary
Reserve requirements are critical tools in monetary regulation, influencing banks' lending capacity and financial stability.
This glossary is for general informational and educational purposes only. Definitions are jurisdiction-agnostic but reflect terminology and concepts primarily drawn from English and American legal traditions. Nothing herein constitutes legal advice or creates a lawyer-client relationship. Users should consult qualified counsel for advice on specific matters or jurisdictions.