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August 1972

RPDs and Other Reserve Operating Targets

by Charlotte E. Ruebling

Since early this year, the Federal Reserve has emphasized member bank reserves available for private nonbank deposits (RPDs) as its short-run operating target. RPDs are a reserve aggregate, defined as total member bank reserves less reserves required against U.S. government demand deposits and net interbank deposits. This article examines a framework in which a reserve aggregate, such as RPDs, functions as an operating target to achieve policy objectives.