Open Market Operations: Key Concepts - FEDERAL RESERVE BANK of NEW YORK

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Open Market Operations: Key Concepts

Temporary open market operations involve repurchase and reverse repurchase agreements that are designed to temporarily add or drain reserves available to the banking system.
Permanent open market operations involve the buying and selling of securities outright to permanently add or drain reserves available to the banking system.
The federal funds rate is the interest rate at which depository institutions lend balances at the Federal Reserve to other depository institutions overnight.

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