RBA's Lowe: 0.25% is the effective lower bound for rates
Lowe continues to cast aside the possibility of diving into NIRP in Australia
- QE could include purchase of state government bonds
- Expects employment growth to be slow but still be reasonable
- Not particularly worried by rising house prices at the moment
As a reminder, that is just two 25 bps rate cuts away from where we are now with the cash rate. The futures market is pricing in just one such rate cut next year so the question now will be what may trigger the threshold for a second cut - and potentially QE - to happen.