Reserve Bank of Australia October 2020 policy meeting. Like everyone else they are awaiting fiscal moves from the Australian government (budget due at 0830GMT today).
- Both the cash rate and the targeted yield on 3 year bonds left at 0.25%
- will not increase cash rate until progress made towards full employment and confident inflation will be sustainably within 2-3% band
- says board continues to consider how additional monetary easing could support jobs as the economy opens up further
- says government bond markets are functioning well
- AUD remains just a little below its peak of the past couple of years
- says board views addressing the high rate of unemployment as an important national priority
- says will maintain highly accommodative settings as long as is required
- wage and prices pressures remain subdued
- the decline in June qtr output was smaller than in most other countries
- labour market conditions have improved somewhat over the past few months and the unemployment rate is likely to peak at a lower rate than earlier expected
- economy recovery is likely to be both uneven and bumpy
- public sector balance sheets in Australia are in good shape, which allows for continued support, with the Australian government budget to be announced this evening
- secondwave outbreak in Victoria has resulted in a further contraction in output there
- says fiscal and monetary support will be required for some time given the outlook for the economy
- says bank's policy package is working as expected and is underpinning very low borrowing costs and the supply of credit to households and businesses
- unemployment and underemployment are likely to remain high for an extended period
- wage and inflation pressures remain very subdued
- very high level of liquidity in the Australian financial system and borrowing costs are at record low
- Over the past couple of weeks, 3-year yields have fallen to around 18 basis points as markets price in some probability of further monetary policy easing
Headlines via Reuters, any bolding is mine.
Mixed in that lot above is a little more optimism than previously:
- decline in growth not as bad as expected
- unemployment rate is likely to peak at a lower rate than earlier expected
Full text of Governor Lowe's accompanying statement is here:
Statement by Philip Lowe, Governor: Monetary Policy Decision
