You are here

Reserve Bank of Australia prepared to boost stimulus if needed: Lowe

nz_rba_021238.jpg
Australia's top central banker struck an optimistic note about the country's economy on Wednesday, but warned a recovery from the coronavirus pandemic would be bumpy and uneven, signalling the need for policy support for a long time to come.

[SYDNEY] Australia's top central banker struck an optimistic note about the country's economy on Wednesday, but warned a recovery from the coronavirus pandemic would be bumpy and uneven, signalling the need for policy support for a long time to come.

Economic growth is expected to be "solidly positive" in both the September and December quarters, Reserve Bank of Australia (RBA) Governor Philip Lowe said at an appearance before a parliamentary economics committee.

"There is still a high degree of uncertainty about the outlook," Mr Lowe said.

"What has become clearer, though, as time has passed is that Australia is likely to experience a run of years with unemployment too high and wage increases and inflation too low, leaving us short of our goals," Mr Lowe added.

"In the current environment, addressing the high rate of unemployment is a priority for the Reserve Bank Board. We are intent on doing what we can, with the tools that we have, to help here," he said, while reiterating that a policy of negative interest rates was extraordinarily unlikely.

Your feedback is important to us

Tell us what you think. Email us at btuserfeedback@sph.com.sg

On Tuesday, the bank left its cash rate at a record low 0.1 per cent and maintained its A$100 billion quantitative easing programme.

Data due later on Wednesday is expected to show the A$2 trillion (S$1.97 trillion) economy expanded 2.6 per cent in the third quarter after a 7 per cent slump in the three months ended June.

REUTERS

BT is now on Telegram!

For daily updates on weekdays and specially selected content for the weekend. Subscribe to t.me/BizTimes