Short Term Money Market (1 Viewer)

[Aj10001]

Is the Short term money market the same thing as the the market for exchange settlement account funds? cause i thought so, but my school examiner crossed out "short term money market" and replaced it with "ES accounts" in one of my essay responses. Just trying to clear it up.

Thanks

 

[timmii]

I think the short term money market includes 90day bank bills as well. Look you can't go wrong with ESA, so stick with that, just in case

 

[saves.the.day]

Timmii's right when she says 90 day bank bills.

The link between ESA and STMM (short term money mkt) is that any deficit or surplus in the banks ESA account is borrowed or deposited in the STMM. So STMM and ESA are totally different. ESA is the account each bank must hold with the RBA and have a certain amt of funds in while the STMM is the market of 90-day short term interest rates where money can be easily borrwed (to finance a deficit in the ESA) or invested (if there is a surplus generated in the ESA).



edit (timmii): I'm female...ignore the weird nickname!