The Reserve Bank of Australia says its shift from a pandemic-era, supply-driven reserve system to an ample-reserves framework remains incomplete and has no fixed completion date. David Jacobs, Head of Domestic Markets, said market behaviour will show when reserves begin reflecting banks’ underlying demand rather than legacy asset holdings, which could mature at a pace that changes demand in either direction. Under the new framework, the RBA will not target a specific reserve quantity. Instead, full-allotment open market operations will supply as much liquidity as banks demand to keep the cash rate near the Monetary Policy Board’s target. Open repo, created for the former scarce-reserves regime, is no longer necessary, although other standing facilities remain available. As reserves decline, financial institutions will need to forecast liquidity needs, use RBA facilities when appropriate and rely more actively on private money markets. The cash-rate target and monetary-policy stance are unchanged, but short-term funding costs may become more variable as market participants manage liquidity more actively.