Reserve Requirementson Foreign Currency Deposits in Sub-Saharan Africa: Main Features and Policy Implications

April 1, 2002

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

This paper reviews the reserve requirement arrangements of sub-Saharan Africa, focusing on the differences between reserve requirements on domestic- and foreign-currency deposits. The reserve requirement systems in sub-Saharan Africa are relatively simple and transparent, but in some countries high unremunerated reserve ratios impose a significant implicit tax on the banks. The currency denomination of the foreign-currency reserve deposits raises concern in countries undergoing large macroeconomic changes or experiencing exchange rate volatility.

Subject: Bank deposits, Banking, Central banks, Currencies, Financial services, Monetary base, Monetary policy, Money, Open market operations, Reserve requirements

Keywords: Africa, Bank deposits, central bank bank deposit, Currencies, deposit, deposit inflow, deposit liability, fiscal policy decision, foreign currency, foreign currency deposits, liquidity management, Monetary base, money multiplier, Open market operations, reserve requirements, Sub-Saharan Africa, WP

Pages:
19
Volume:
2002
DOI:
https://doi.org/10.5089/9781451848694.001
Issue:
065
Series:
Working Paper No. 2002/065
Stock No:
WPIEA0652002
ISBN:
9781451848694
ISSN:
1018-5941

Loading component...

IMF’s Work

RESOURCES

TOPICS

Flagship Publications

Other Publications

IMF reports and publications by country

Regional Offices

All News

See Also

For Journalists

Press Center

RESOURCES

FLAGSHIPS

KEY SERIES

IMF NOTES

Loading component...

IMF Working Papers