Skip to main content Skip to main navigation
Skip to access and inclusion page Skip to search input

BILL'S BITES: All eyes on RBA's response

01:06pm March 18 2020

Westpac chief economist Bill Evans discusses the growth outlook and RBA's response to the COVID-19 pandemic. (Josh Wall)

On Monday, the Reserve Bank Governor announced a series of initiatives to boost liquidity in financial markets and that additional policy initiatives will be outlined at 4pm tomorrow.

Yesterday’s board minutes provided further support to Westpac’s view that a further 0.25 per cent reduction in the cash rate can be expected, following the cut from 0.75 per cent to 0.5 per cent earlier this month due to concerns about the impact of COVID-19 on the Australian and global economy. 

A cash rate of 0.25 per cent is almost certain to be the “effective lower bound” as set out by the Governor in a speech on November 26. 

In addition, the Bank’s much awaited quantitative easing will also be announced, most likely targeted at the risk-free yield curve effectively setting a price rather than nominating a quantity of purchases as has been used by the FOMC in the United States.

This material contains general commentary, and market colour. This material does not constitute investment advice. This information has been prepared without taking account of your objectives, financial situation or needs. We recommend that you seek your own independent legal or financial advice before proceeding with any investment decision. Whilst every effort has been taken to ensure that the assumptions on which the forecasts are based are reasonable, the forecasts may be affected by incorrect assumptions or by known or unknown risks and uncertainties. The ultimate outcomes may differ substantially from these forecasts. Except where contrary to law, Westpac and its related entities intend by this notice to exclude liability for this information.
 

William (Bill) Evans is Westpac’s economic spokesman and is responsible for all of our economic research. In 1991, Bill joined Westpac as the Chief Economist and Head of Research. A graduate of Sydney University (BEc. Hons I and University Medal) and the London School of Economics (M. Sc.), Bill has worked as Research Manager for the Reserve Bank of Australia and as a Treasurer at the Commonwealth Bank of Australia. Bill travels frequently, advising Westpac’s customers on the Australian economy and financial markets.

Browse topics