RBA’s Debelle: No need for negative interest rates now

Dhwani Mehta FXStreet

Further headlines are crossing the wires from the Reserve Bank of Australia (RBA) Deputy Governor Guy Debelle, as he responds to the Q&A session following his speech at the Economic Society of Australia webinar on Tuesday.

“No need for negative interest rates now.”

“Not clear how effective negative rates are.”

“Government has been providing plenty of fiscal stimulus.”

“If all fiscal stimulus ceased at end of sept, that would be a problem.”

“Top priority is accelerating economic growth.”

“CPI could well be negative in the June qtr.”

“Expect the economy will pick up some from here.”

“Do not see much risk of high inflation from any source.”

“Feedback is that liquidators are not seeing much bankruptcies at all.”

“But could be large pipeline of bankruptcies building.”

“2-3% inflation target remains worthwhile objective.”

Market reaction

AUD/USD is little changed around 0.6880 on the above comments, consolidating the renewed upside amid positive Asian stocks and upbeat Chinese Manufacturing PMI data. The spot adds 0.23% so far.

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.

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