Based on the minutes of the Reserve Bank of Australia (RBA) meeting minutes published earlier in the Asian session, the central bank believes very significant monetary support will be needed for some time to achieve inflation and unemployment targets.
The RBA stated that bond purchase programs and interest rate reductions have contributed to lower exchange rates than others. Following that, it is still too early to consider withdrawing monetary stimulus.
According to the minutes of the published meeting, RBA policymakers concluded that monetary support was crucial and necessary for some time and took years to achieve the goals of the central bank.
The RBA also predicts that inflation will not reach the 2% target by mid-2023, the main reason why it is not expected to start raising interest rates until 2024.
In addition, RBA policymakers also stated that if they terminated the purchase of bonds earlier, it would put continued pressure on the Aussie dollar.
Meanwhile, the central bank is monitoring the impact of simple policies on the economy and says there are few signs of a decline in lending standards at this time.
Earlier this month, the RBA announced that it would expand its bond purchase program by an additional AU $ 100 billion and keep interest rates at a low of 0.10%.
Although the RBA statement looks dovish, the Aussie dollar trade looks unwavering and continues to rise near the one-month high against the USD in the Asian session.
