RBA’s Lowe: Not considering negative rates, AUD/USD bounces

Dhwani Mehta FXStreet

The Reserve Bank of Australia (RBA) Governor Phillip Lowe is back on the wires now, responding to the Q&A session following his speech on the labor market and monetary policy at a webinar hosted by the Economic Society of Australia on Thursday.

Key quotes

“Not considering negative rates.”

“Fiscal policy will need to play a bigger role in future cycles.”

“Likely QE will be needed in future business cycles.”

“But there are limits, central banks cannot keep buying assets.”

“Does not see a convincing case for a change to the CPI target.”

“Will take a long time to get wages above 3%.”

“Maybe markets do not believe our reaction function.”

“Will not raise rates to choke off housing price rises.”

“Modest scaling back in bond buying reflects economic progress.”

Market reaction

AUD/USD bounces about 10-pips, as RBA Lowe’s Q&A session gets underway. The spot now trades at 0.7465, still down 0.21% on the day.

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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