The Reserve Bank of Australia (RBA) remains steadfast in its monetary policy stance to set interest rates at the lowest level and target bond yields at 0.25% at the October session policy meeting today.
Through a joint statement issued by the central bank, the economy is said to need some time to return to the end of 2019, and the policy will remain accommodative as long as it is needed.
In addition, the central bank also stated that efforts to control high unemployment rates are an important priority for the country at this time. However, the RBA expects the unemployment rate to rise at a lower rate than previously predicted.
Meanwhile, economic recovery from the coronavirus outbreak is said to be taking place in much of Australia, although a second wave outbreak in Victoria has resulted in reduced production.
In addition, the RBA says that current monetary policy is running as expected and helps lower the cost of borrowing and credit offerings, where long-term financing facilities have contributed $ 81 billion to banks and other institutions.
The central bank also reiterated that it will not raise interest rates until there is progress in achieving the full employment target and inflation between 2% -3%.
The Aussie dollar soared following the RBA's decision before reversing following analysts' expectations that the central bank would cut interest rates to a new low of 0.10% at next month's policy meeting.
In the meantime, the Australian government will publish the national budget today, where it is expected to increase spending to support employment and economic growth hit by the coronavirus crisis.
