The Reserve Bank of Australia, the cash rate and the Australian dollar as legal tender

Background

The Reserve Bank of Australia is constituted by the Reserve Bank Act 1959, an Act administered by the Department of the Treasury. Section 26 provides that the Reserve Bank is the central bank of Australia and shall carry on business as a central bank.
Section 8AA states the Bank's overarching objective: to promote the economic prosperity and welfare of the people of Australia both now and into the future. Section 45 adds that the Reserve Bank's functions include contributing to the stability of Australia's financial system.
Under the Act the Bank has 3 Boards - the Monetary Policy Board, the Payments System Board and the Governance Board - and the Governor is to resolve any disagreements between the Boards. The first function of the Monetary Policy Board is to determine the monetary policy of the Bank in a way that, in the Board's opinion, best contributes to price stability in Australia and the maintenance of full employment in Australia.
Treasury's account of the framework explains that the stance of monetary policy is expressed in terms of an operating target for the cash rate, which it defines as the interest rate on overnight loans made in the money market. That rate is used as the operational target because it underpins all other interest rates in the money market and, through banks' costs of funds, also underpins banks' lending interest rates. Since 1993 the objective has been to keep inflation between 2 and 3 per cent, on average, over the cycle, an objective formalised in the Statement on the Conduct of Monetary Policy between the Treasurer and the Governor of the Reserve Bank.
Australian notes shall be printed by, or under the authority of, the Bank, and the Reserve Bank Act 1959 provides, in section 36, that Australian notes are a legal tender throughout Australia.
Coins are governed by the Currency Act 1965, an Act relating to Currency, Coinage and Legal Tender. It provides that the monetary unit, or unit of currency, of Australia is the dollar, and that the denominations of money in the currency of Australia are the dollar and the cent. Section 16 caps payment in coin: coins of the denomination of Five cents, Ten cents, Twenty cents or Fifty cents are a legal tender for payment of an amount not exceeding $5 but for no greater amount, and coins of a denomination greater than Fifty cents but less than Ten dollars for an amount not exceeding 10 times the face value of a coin of the denomination concerned.
The Royal Australian Mint, a listed entity within the Commonwealth Government portfolio of the Treasury, is the sole supplier of Australia's circulating coinage. The Parliamentary Education Office records that section 51 of the Australian Constitution gives the Australian Parliament the power to make laws about banking and currency, and that the Commonwealth Bank was given responsibility to produce currency notes in 1924, a role it undertook until 1960 when the Reserve Bank of Australia was established as Australia's central bank.