Suppose a central bank purchases $30 billion in foreign reserves from the non-bank public in return for $30 billion in deposits for the non-bank public to try to reduce its country's FX rate. Show the Balance Sheet accounts for the central bank's asset and liabilities and how this would be carried out with a sterilized foreign exchange intervention, so there will be $0 change in the monetary base of the country.

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The Answer of Suppose a central bank purchases $30 billion in foreign reserves from the non-bank public in return for $30 billion in deposits for the non-bank public to try to reduce its country's FX rate. Show the Balance Sheet accounts for the central bank's asset and liabilities and how this would be carried out with a sterilized foreign exchange intervention, so there will be $0 change in the monetary base of the country.

Suppose a Central Bank Purchases $30 Billion in Foreign Reserves