QE comes Down Under
The Reserve Bank of Australia (RBA) unleashed the expected range of measures to lower interest rates and the exchange rate.
The package include a reduction in the cash rate and $100 billion of bond buying:
Source: RBA
The cash rate will be kept on hold at not higher than 0.10 per cent for at least the next 3 years:
Source: RBA
The RBA indicated that a tight labour market is the goal, so realistically the cash rate could be on hold for much longer than three years.
The unemployment rate is forecast to peak at just under 8 per cent, and then is expected to decline back towards 6 per cent by the end of 2022.
The economic forecasts paint a somewhat brighter picture than previous assessments earlier in the year.
