Macroeconomics
Open Market Operation
Definition
What is Open Market Operation?
A central-bank purchase or sale of securities to manage liquidityThe ease and speed with which an investment can be converted into cash without a major price concession. and interest rates.
Example in practice
How This Looks in Practice
The central bank sells bills to absorb excess banking-system liquidity.
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Related Terms
Macroeconomics
Gross Domestic Product
The total market value of final goods and services produced within a country during a period.
MacroeconomicsReal GDP
Gross domestic product adjusted for changes in prices.
MacroeconomicsNominal GDP
Gross domestic product measured at current prices without adjusting for inflation.
Market SentimentRisk-On Market
A market environment in which investors favour higher-risk assets.