The Reserve Bank of Australia has left the nation’s official cash rate on hold at the historic-low level of 0.25 per cent.
After an extraordinary March period – which included an emergency out-of-cycle rate cut to 0.25 per cent – RBA economists decided current quantitative easing measures were being effective.
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“The coronavirus remains first and foremost a very major public health issue, but it is also having very significant effects on economies and financial systems around the world,” wrote Mr Lowe.
“Many countries are expected to experience large economic contractions as a consequence of the public health response. Large increases in unemployment are also expected.
“Once the virus is contained, a recovery in the global economy is expected, with the recovery supported by both the large fiscal packages and the significant easing in monetary policy that has taken place.”
CoreLogic’s Head of Research Eliza Owen said that the current rate could be here to stay.
“The record-low rate of 0.25% may be in place for years to come. No doubt the RBA will be closely monitoring the impact of record low interest rates and other stimulus measures on the economy,” Ms Owen said.
“To date, the policy announcements from the RBA and other sectors of government have been well received with the overall level of stimulus now getting close to 17 per cent of Australian GDP.”
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