Regulatory Alerts2024-09-25 | 2024-21909Regulation D: Reserve Requirements of Depository Institutions
The Board of Governors of the Federal Reserve System issued a final rule amending Regulation D to lower the interest rate paid on reserve balances to 4.9 percent, a 0.5 percentage point decrease from the prior 5.4 percent level. This adjustment, applicable as of September 19, 2024, supports the Federal Open Market Committee’s recent reduction of the federal funds rate target range to 4.75–5.00 percent and reinforces the rate’s role in monetary policy implementation. The Board invoked good cause to bypass standard notice-and-comment procedures, ensuring the monetary policy change takes effect without administrative delay.
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