RBA: Accommodative approach will be maintained as long as it is required

Following are the key headlines from the August RBA monetary policy statement, via Reuters, as presented by Governor Phillip Lowe.

Committed to do what it can to support jobs, incomes and business.

Global outlook remains uncertain.

Target will remain in place until progress made towards goals for full employment, inflation.

Likely that fiscal and monetary support will be required for some time.

Bank's mid-march package of support for the Australian economy is working as expected.

Inflation is expected to average between 1 and 1½ per cent over the next couple of years.

Inflation is expected to return to positive territory in the current quarter.

Will purchase gov't bonds in the secondary market on Wednesday to ensure that the yield on 3-year bonds.

Australian economy going through a very difficult period; experiencing biggest contraction since the 1930s.

Government's recent announcement that various income support measures will be extended is a welcome development.

Ownturn is not as severe as earlier expected and a recovery is now underway in most of Australia.

Recovery is, however, likely to be both uneven and bumpy, with the coronavirus outbreak in Victoria.

In its baseline scenario for GDP growth, output falls by 6% over 2020 and then grows by 5% over the following year.

In the baseline scenario, the unemployment rate rises to around 10% later in 2020 due to further job losses in Victoria.

Over the following couple of years, the unemployment rate is expected to decline gradually to around 7 per cent.

A stronger recovery is possible if progress is made in containing the virus in the near future.

• AUD/USD stays positive above 0.7100 on RBA’s status-quo