Australia’s central bank kept monetary policy unchanged Tuesday, clearing the field for the government to unveil a fiscal blueprint designed to drive the economy’s recovery from a Covid-induced recession.
Reserve Bank Governor Philip Lowe kept both the key interest rate and three-year yield target unchanged at 0.25%, as expected. The labor market is a key focus for the bank, which is due to release fresh forecasts next month, he said.
“The Board views addressing the high rate of unemployment as an important national priority,” Lowe said in a statement. Policy settings will remain highly accommodative for as long as required and the bank “continues to consider how additional monetary easing could support jobs as the economy opens up further,” he said.
The RBA has been working in tandem with fiscal policy makers, pushing down the cost of borrowing to smooth the path for major spending programs. The government’s budget, due