Aussie central bank gets US$8.8 billion from government

Infusion to strengthen the bank’s financial position.

The one-off grant will improve the Reserve Bank of Australia's capacity to conduct its monetary policy and foreign exchange processes.

Treasurer Joe Hockey said Glenn Stevens, governor of the Reserve Bank, has written him indicating that the Reserve Bank Board believes it would be appropriate for the Reserve Bank Reserve Fund to be increased to 15% of the bank's assets at risk.

Analysts said this injection of funds strengthens the Reserve Bank's ability to perform its core monetary policy and foreign exchange functions in an environment of heightened financial market volatility.

Australia's financial system depends on the financial strength of the Reserve Bank and the credibility of its monetary policy and foreign exchange operations.