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A provision allowing counterparties to fulfil their reserve requirements on the basis of their average reserve holdings over the maintenance period. The averaging provision contributes to the stabilisation of money market interest rates by giving institutions an incentive to smooth the effects of temporary liquidity fluctuations. The Eurosystem's minimum reserve system allows for averaging.
The following video provides you with the correct English pronunciation of the word "averaging provision", to help you become a better English speaker.
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| averaging provision in Spanish
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