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Deposit Auction Arrangement (DAA)
The Deposit Auction Arrangement (DAA) is a liquidity management tool introduced by the Central Bank of Seychelles (CBS) in September 2008 as part of initial steps in its monetary policy reforms of 2008. CBS uses this instrument to mop up excess liquidity in the system whilst the banks use it to maximise interest earnings on any excess liquidity. The first DAA auction took place on September 22, 2008 and has been conducted on a weekly basis since then, in consideration of the reserve money target.
This instrument is an auction facility whereby CBS accepts deposits from institutions liable to Minimum Reserve Requirements and shall be from 2 days up to 7-days, and thereafter in multiples of seven (7) up to ninety one (91) days. On the longer term, these shall be in one hundred and eighty-two (182) days and three hundred and sixty-five (365) days.