RBA: High debt levels could complicate future monetary policy decisions
The Reserve Bank of Australia (RBA) was out with its Corporate Plan 2019/2020, citing that high debt levels could complicate future monetary policy decisions by making the economy less resilient to shocks.
Further Points:
Movements in asset values and leverage may be more important for economic developments than in the past given the already high levels of debt on household balance sheets.
It was "continuing to closely monitor" developments in residential mortgage lending and the risks arising from the high level of household indebtedness.
Regulators "stand ready to consider further measures" to address any risks in the system.
The plan outlines the key functions and purposes of the Bank.
This comes after the Australian Building Permits data dropped sharply in July and Private Sector Credit growth slowed last month.
The AUD/USD pair sticks to lows just ahead of the 0.67 handle on poor Australian data releases that fan RBA rate cut calls.
Author
Dhwani Mehta
FXStreet
Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.
