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December 1982

The New System of Contemporaneous Reserve Requirements

by R. Alton Gilbert and Michael E. Trebing

​The Board of Governors of the Federal Reserve System recently announced its decision to implement a version of contemporaneous reserve requirements that will become effective in February 1984. This article describes both the regime of lagged reserve requirements currently in effect and the new system of contemporaneous reserve requirements and explains why each feature of the new reserve accounting system was adopted.