The Deputy Governor of the Reserve Bank of Australia (RBA), Guy Debelle has said he does not expect a rate hike for three years, in a scheduled speech on “Monetary Policy 2020” at the Australian Business Economists webinar.
Additional comments:
Political action has reduced borrowing costs.
The bond purchase program means that the australian dollar is lower than it would be otherwise.
It is a necessary program since Australian 10-year returns were higher than similar countries.
Care must be taken in not eliminating monetary stimulus too early.
The Australian government debt is very manageable.
Federal and state government debt are “absolutely sustainable.”
Board do not expect to increase the cash rate for at least 3 years.
A materially lower unemployment rate is needed to raise wages and inflation.
Banks have strong balance sheets to help the economy recover.
The average mortgage interest rate paid by households is expected to decline further.
Vaccine news should help build confidence.
It will probably be some time before vaccines are widely available and distributed.
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