Governor Lowe On The RBA's Broader Bond Buying Scheme

"The bond purchase program has also been an important part of the RBA's monetary policy response. It has lowered bond yields and funding costs across the economy and contributed to a lower exchange rate. With the current 6-month bond purchase program to be completed in September, the Board has been working through a range of options for what comes next. These options include:

• ceasing purchasing bonds in September;
• repeating the current $100 billion purchase program over a similar time frame;
• scaling back the amount purchased or spreading the purchases out over a longer period; or
• moving to an approach where the pace of the bond purchases is reviewed more frequently, based on the flow of data and the economic outlook."
• "We have made no decisions yet, other than to rule out the first option – the cessation of bond purchases in September. The RBA's bond purchase program is one of the factors underpinning the accommodative conditions necessary for our economic recovery. It is premature to be considering ceasing bond purchases."
• "The key consideration in our decision here is how the RBA can best support the ongoing recovery of the economy. The Board wants to see the recent recovery transition into strong and durable economic growth, with low unemployment and faster growth in wages than we have seen recently. Over time, this will help achieve the inflation target."