Case for keeping rates low remains strong: Shadow RBA

With Australia's economy remaining fragile due to COVID-19, the official cash rate should remain on hold for now, according to The Australian National University's Shadow RBA Board. For a fifth month in a row, the Shadow Board's view on a possible change to the official cash rate remains the same. The Board is 94% confident that keeping interest rates at 0.25 per cent is the right policy. In contrast, the Board is six per cent confident that a final rate cut, to zero per cent, is appropriate. Shadow Board chair Dr Timo Henckel says while Australia appears to have weathered the COVID-19 crisis exceptionally well, the stage 4 restrictions in Victoria have put a dampener on this success. "It's clear the economy is still a long way from returning to normal," Dr Henckel said. "The official unemployment rate - a key factor - ticked up again in July, to 7.5 per cent, the highest jobless rate since October 2001.
account creation

TO READ THIS ARTICLE, CREATE YOUR ACCOUNT

And extend your reading, free of charge and with no commitment.

Register


Login

Your Benefits

  • Access to all content
  • Receive newsmails for news and jobs
  • Post ads

myScience