Deposit reserve refers to the deposit prepared by financial institutions in the central bank to ensure the needs of customers to withdraw deposits and settle funds. The ratio of the deposit reserve required by the central bank to its total deposit is the deposit reserve ratio.

2. rediscount policy

Rediscouting refers to the transfer of unexpired bills obtained by commercial banks or other financial institutions to the central bank. For the central bank, rediscounting means buying bills held by commercial banks, flowing out real money and expanding the money supply.

For commercial banks, rediscounting means selling discounted bills to solve the temporary shortage of funds. The whole rediscount process is actually the process of bill trading and capital transfer between commercial banks and central banks.

3. Open market business

Open market business refers to the activities of the central bank to regulate the money supply by buying and selling securities and handling the base currency. Different from the securities trading of general financial institutions, the purpose of securities trading of the central bank is not to make profits, but to regulate the money supply.

Known as the "three magic weapons" of the central bank. Mainly from the total money supply and credit scale adjustment.

It is a means adopted by the central bank and has a comprehensive or general impact on the expansion and contraction of money and credit in the whole financial system. It is the most important monetary policy tool.