• Continues that world faces extended period of little credit growth.
  • Period of low global rates is problematic .
  • Sees effects of low-rate era as long-lasting.
  • Says Aud $ is high primarily because of very high terms of trade.
  • Says high Aud $ has been important stabilizing impact on economy.
  • Makes hard case that Aud$ is overvalued.
  • Household credit growing in line with incomes is more sustainable.
  • Policy role is to ensure inflation is under control.
  • Calls slower credit growth in Australia ‘new normal’.
  • Says capital inflow to bond market pushes A$ a bit.
  • Rising deposit rates lifting local rate structure.
  • Monetary policy can’t do much on structural issues.

Aud $ remains at 1.0250.