RBA's Debelle: Not convinced negative rates would work
|The Reserve Bank of Australia's (RBA) Deputy Governor Guy Debelle was out on the wires Tuesday, stating lack of conviction in negative interest rate policy as a tool to boost inflation and employment.
The central bank recently cut rates to a record low of 0.10% and has been buying bonds since the second quarter to contain the economic fallout from the coronavirus outbreak.
Debelle said that the Australian dollar has seen a notable depreciation since the quantitative easing (bond buying) was first priced in by markets. However, the AUD/USD pair is currently trading at 0.7314, representing over 4% gains for the year.
Key quotes
- Don't see much risk of inflation rising too high in the next three years.
- There is lots of uncertainty on economy
- There is long way to get back to pre-pandemic levels
RBA’s Debelle: Do not see too much upward pressure on house prices
RBA’s Debelle: Does not expect a rate hike for three years
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