At its meeting today, the Board of the Reserve Bank of Australia have decided to maintain the current policy settings, including the targets for the cash rate and the yield on 3-year Australian Government bonds of 25 basis points.

• The global economy is experiencing a severe downturn as countries seek to contain the coronavirus. Many people have lost their jobs and there has been a sharp rise in unemployment.
• The Australian economy is going through a very difficult period and is experiencing the biggest economic contraction since the 1930s. Household spending weakened very considerably and investment plans are being deferred or cancelled.
• Notwithstanding these developments, it is possible that the depth of the downturn will be less than earlier expected. The rate of new infections has declined significantly and some restrictions have been eased earlier than was previously thought likely.

The Board is committed to do what it can to support jobs, incomes and businesses and to make sure that Australia is well placed for the recovery. Its actions are keeping funding costs low and supporting the supply of credit to households and businesses.

To view the full statement of Philip Lowe, Governor of the Reserve Bank, please click here.

Published : 02 Jun 2020