Non-Borrowed Reserves

AAA

DEFINITION of 'Non-Borrowed Reserves'

A measure of the reserves in the banking system. Non-borrowed reserves represent the numerical difference between total reserves minus funds that have been borrowed from the Fed discount window.

The first element of this equation consists of the total reserves held at deposit at the Fed by member banks plus the composite cash in their vaults. The second element is money borrowed by banks through the Fed discount window.

INVESTOPEDIA EXPLAINS 'Non-Borrowed Reserves'

The total amount of non-borrowed reserves is computed each week by the Federal Reserve Bank. The level of reserves is sometimes targeted by adjusting the Fed funds rate to implement monetary policies. Although the arithmetic computation of non-borrowed reserves is quite simple, the underlying factors that sometimes affect this number can be quite complex.

RELATED TERMS
  1. Lagged Reserves

    A method of bank reserve calculation whereby the financial institution ...
  2. Free Reserves

    A measurement of a bank's reserves that is equal to the difference ...
  3. Reserve Fund

    An account set aside by an individual or business to meet any ...
  4. Capital Reserve

    A type of account on a municipality's or company's balance sheet ...
  5. Excess Reserves

    Capital reserves held by a bank or financial institution in excess ...
  6. Treasury Direct

    The online market where investors can purchase federal government ...
Related Articles
  1. What are the generally accepted accounting ...
    Investing

    What are the generally accepted accounting ...

  2. Oil And Gas Industry Primer
    Active Trading

    Oil And Gas Industry Primer

  3. How Is Europe Affecting The Martkets?
    Economics

    How Is Europe Affecting The Martkets?

  4. What are the main components of the ...
    Economics

    What are the main components of the ...

Hot Definitions
  1. Hyperinflation

    Extremely rapid or out of control inflation. There is no precise numerical definition to hyperinflation. Hyperinflation is ...
  2. Gross Rate Of Return

    The total rate of return on an investment before the deduction of any fees or expenses. The gross rate of return is quoted ...
  3. Debit Spread

    Two options with different market prices that an investor trades on the same underlying security. The higher priced option ...
  4. Leading Indicator

    A measurable economic factor that changes before the economy starts to follow a particular pattern or trend. Leading indicators ...
  5. Wage-Price Spiral

    A macroeconomic theory to explain the cause-and-effect relationship between rising wages and rising prices, or inflation. ...
  6. Accelerated Depreciation

    Any method of depreciation used for accounting or income tax purposes that allows greater deductions in the earlier years ...
Trading Center