1980s to 1990s
In the 1980s and 1990s, we operated with a focus on the quantity of settlement cash in the system, rather than interest rates directly. This approach did create challenges with clarity and communication around our view on appropriate monetary policy conditions. Since 1999, the OCR has been the focus of monetary policy implementation.
1999 to 2020
From 1999 until 2020 we operated corridor and tiered remuneration regimes which required tight management of the settlement cash level and frequent fine-tuning operations.
2020 to present
From 2020, we adopted a floor system for monetary policy, where all settlement cash balances are remunerated at the OCR. This framework provides flexibility at different levels of settlement cash and has proven to be a simple and effective framework for achieving our policy objectives.