Question

What is the Term Deposit Facility? What role does it play in managing the risk of inflation in the current US economy?

Answer 1

A terms deposit is nothing but a deposit that can be made with a fixed maturity rate on the whole. Term Deposit Facility is nothing but Federal Reserve get to offer term deposits that indeed bear a certain amount of interest for institution that seek eligible for the program. Usually term deposits get to carry higher amount of interest rates and this is because of the fact that the investor get to have money locked where the access is actually limited under a certain time bracket. This makes easy to predict the amount of money flow and can account for the risk of inflation in the US economy.