Australia’s central bank chief Philip Lowe said he’s ready to ease policy further if his recent back-to-back cuts fail to revive economic growth and flagged “an extended period” of low interest rates.
Lowe said in the text of a speech in Sydney Thursday that it could turn out that a combination of the consecutive rate reductions, tax cuts, higher commodity prices, a stabilizing housing market and infrastructure investment spur the economy and lift inflation.
“But if demand growth is not sufficient, the board is prepared to provide additional support by easing monetary policy further,” he said. “Whether or not further monetary easing is needed, it is reasonable to expect an extended period of low interest rates. On current projections, it will be some time before inflation is comfortably back within the target range.”
Westpac Banking Corp. Chief Economist Bill Evans on Wednesday predicted Lowe and co. would cut in October and February to push the cash rate to 0.5%.
Source : Bloomberg