In Canada, a reserve is a First Nations community recognized by the Indian Act, similar to what are called Indian reservations in the United States.
In military terms a reserve can mean forces (or army) held back from battle in order to deal with unforseen contingencies, or to exploit successes, or to relieve troops that have lost their effectiveness.
In legal terms, a judge may reserve a decision in a case, which means that he takes time to consider the judgment rather than delivering it straight after hearing the parties to the case.
The transactions-account reserve requirement is applied to deposits over a two-week period: a bank's average reserves over the period ending every other Wednesday must equal the required percentage of its average deposits in the two-week period ending the Monday sixteen days earlier.
Furthermore, the Federal Reserve operates in a way that permits banks to acquire the reserves they need to meet their requirements from the money market, so long as they are willing to pay the prevailing price (the federal funds rate) for borrowed reserves.
Reserve requirements impose a cost on the banks equal to the foregone interest on the amount by which required reserves exceed the reserves that banks would voluntarily hold in order to conduct their business, and the Fed has been hesitant to make changes that would increase that cost.
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