associated with the full range of the agencies ’ regulations that affect insured depository institutions. the board and the other banking agencies are in the midst of the first ten - year review cycle, and i am pleased to report that we are on track to complete this process by the 2006 deadline. the agencies already have solicited comments on four broad categories of regulations including those governing applications, activities, money laundering, and consumer protection in lending transactions - and have conducted outreach meetings throughout the country to encourage public participation in the egrpra process. in response to these efforts, the agencies have received comments from more than 1, 000 entities and individuals on ways to reduce the regulatory burden on banking organizations. the board will consider and incorporate the comments relevant to our regulations as we move forward with our own regulation review efforts. while the banking agencies can achieve some burden reductions through administrative action, congress plays a critical role in the regulatory relief process. many proposals to reduce regulatory burden require congressional action to implement. moreover, the congress has ultimate responsibility for establishing the overall regulatory framework for banking organizations, and through its actions congress can ensure that regulatory relief is consistent with the framework it has established to maintain the safety and soundness of banking organizations and promote other important public policy goals. interest on reserves and reserve requirement flexibility for the purpose of implementing monetary policy, the board is obliged by law to establish reserve requirements on certain deposits held at depository institutions. by law, the board currently must set the ratio of required reserves on transaction deposits above a certain threshold at between 8 and 14 percent. because the federal reserve does not pay interest on the balances held at reserve banks to meet reserve requirements, depositories have an incentive to reduce their reserve balances to a minimum. to do so, they engage in a variety of reserve avoidance activities, including sweep arrangements that move funds from deposits that are subject to reserve requirements to deposits and money market investments that are not. these sweep programs and similar activities absorb real resources and therefore diminish the efficiency of our banking system. the board ’ s proposed amendment would authorize the federal reserve to pay depository institutions interest on their required reserve balances. paying interest on these required reserve balances would remove a substantial portion of the incentive for depositories to engage in reserve avoidance measures, and the resulting improvements in efficiency should eventually be passed through to bank borrowers and depositors. besides required reserve balances, depository institutions also voluntarily hold two other types of balances in their reserve bank

s 2 / 4 bis central bankers'speeches package of monetary policy measures is providing substantial support to the australian economy in the face of lockdowns and the expected resumption of the economic expansion. these monetary policy measures include : the term funding facility a yield target for the april 2024 australian government bond of 10 basis points the bond purchase program under which the rba is purchasing bonds issued by the australian government and by the state and territory governments a cash rate target of 10 basis points. i would like to provide the committee with an update on each of these elements of the package. first, the term funding facility. a total of $ 188 billion was drawn down by financial institutions under this facility before the deadline for final drawings of 30 june. the interest rate on most of these funds is 10 basis points and the funding does not have to be repaid for 3 years. this means that, even though the facility is now closed to new drawings, it will continue to support low funding costs in australia out to mid 2024. at its july meeting, the board considered the yield target and decided to retain the april 2024 australian government bond as the target bond, rather than extend it to the november 2024 bond. the target remains at 10 basis points, the same as for the cash rate. the target has played an important role in keeping funding costs low and reinforcing our forward guidance regarding the cash rate, and it will continue to play this role over the next few years. the decision not to extend the target to the next maturity reflects a shift in the probabilities regarding future movements in the cash rate. when the 3 - year yield target was introduced last year, it was difficult to conceive scenarios in which the cash rate would be increased over the subsequent 3 years, which at the time ran to early 2023. eighteen months on, there are now plausible scenarios in which the cash rate is increased over a 3 - year horizon, which now runs until late 2024. given this shift, the board decided that it was not appropriate to extend the yield target to the end of 2024. at our july meeting, we also decided that we would continue purchasing government bonds following the completion of the second $ 100 billion program in early september. in addition, we decided that the purchases would be at a rate of $ 4 billion a week until at least november, rather than the current $ 5 billion a week. we also indicated that we had a flexible approach and could adjust the