Reserve Bank of Australia Governor Lowe saying no growth until the final quarter of this year due to the renewed COVID-19 outbreak in Victoria
Lowe is appearing in front of the Parliament's House of Representatives' Standing Committee on Economics
Headlines via Reuters:
- says q2 GDP likely to show drop of around 7%
- high degree of uncertainty about the outlook and our economic recovery
board considered the possibility of undertaking a regular program of bond purchases - expecting Australian economy to contract around 6% this year, and then grow by 5% next year and 4% in 2022
- says not expecting a lift in economic growth until the December quarter due to Victoria coronavirus outbreak
- chose yield target as it reinforces the forward guidance regarding the cash rate
- says baseline forecast for unemployment rate to increase, reaching around 10 per cent later this year
- conditions for rate rise not likely to be met for at least three years
- says for time being, board's view is that best course of action is to continue with the current package
- says monetary financing of the budget is not on the agenda in Australia
- board has clearly indicated it will not raise cash rate until progress is made towards full employment, inflation target
- says it is highly likely that the cash rate will be at this level for some years
- says have not ruled out a separate bond buying program, or other adjustments to the mid-March package
- says for the time being, the board's view is that the best course of action is to continue with the current package
- says expected increase in public debt is entirely manageable and is affordable
- says right thing to do to borrow today to help people, keep them in jobs
- says high unemployment is likely to be with us for some time
Full text:
Around 3 hours of Q&A will begin soon
