Which of the following would be categorized as an unconventional monetary policy tool?

Targeted asset purchases are considered an unconventional monetary policy tool because they involve the central bank purchasing specific assets to influence broader financial conditions and achieve monetary policy goals. Unlike traditional tools which focus primarily on interest rate adjustments, targeted asset purchases are aimed at particular sectors of the economy, such as mortgage-backed securities or government bonds. This strategy can lower long-term interest rates, enhance market liquidity, and stimulate economic activity by encouraging lending and investment in specific areas that may not respond adequately to conventional policy measures.

In contrast, the other options listed reflect more traditional monetary policy tools. For instance, the interest rate on excess reserves and the deposit rate are standard mechanisms for influencing banks' reserve levels and thereby impacting overall liquidity in the banking system. The federal funds rate target range is also a conventional tool, as it directly guides short-term interest rates in the broader economy through the control of interbank lending rates. These tools are more widely used and understood within the framework of traditional monetary policy.