RBA kept policy rates unchanged, yield targeting continues

May 05, 2020 04:50 PM AEST
Team Kalkine

The Reserve Bank of Australia has kept the cash rate unchanged at 0.25% in today’s monetary policy decision.

The bank acknowledged rising unemployment and economic contraction across the world with visible results of containment measures.
It was said that the global financial markets are operating effectively as against previous month.
3-year bond target is being attained, and the bank has scaled back Govt bond purchases, which to date are $50 billion.
IG rated non-bank bonds are being accepted as collateral to support credit and funding cost through open market operations.
It expects CPI to hit negative in the June quarter, and between 1-1.5% in 2021.
Policy stance is expected to remain, until any progress is made towards full employment and 2-3% inflation range.

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