How to Develop A Framework for the Investment of Temporary Government Cash Surpluses

By Israel Fainboim Yaker, Sandeep Saxena, Michael J. Williams

December 21, 2020

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Israel Fainboim Yaker, Sandeep Saxena, and Michael J. Williams How to Develop A Framework for the Investment of Temporary Government Cash Surpluses, (USA: International Monetary Fund, 2020) accessed November 21, 2024

Summary

Well-developed cash management aims to improve government operational efficiency and facilitates better service delivery by ensuring liquidity to meet payment obligations as they fall due. Liquidity, however, comes at a cost. Governments can reduce the cost of maintaining liquidity by proactively managing their cash balance at an appropriate level and prudently investing any excess liquidity. This note discusses the policy framework and processes that governments should put in place to identify, guide, and govern the investment of their surplus cash resources.

Subject: Credit risk, Currencies, Financial markets, Financial regulation and supervision, Government cash forecasting, Government cash management, Money, Money markets, Public financial management (PFM)

Keywords: Africa, Cash balance, Cash buffer, Cash manager, Cash surplus, Credit risk, Currencies, Debt management, FADHTN, Global, Government cash forecasting, Government cash management, HTN, Liquidity risk, Market liquidity, Market risk, Money markets, Reverse repo, Surplus cash

Publication Details

Pages:

25
Volume:

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DOI:

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Issue:

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Series:

How-To Note No. 2020/003
Stock No:

HTNEA2020003
ISBN:

9781513563824
ISSN:

2522-7912

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