RBA Board Member Says Central Bank Not Lacking in Firepower (WSJ)

Below are the key points from a WSJ interview with RBA board member Ian Harper:

• "There is certainly capacity for the Reserve Bank to do some more if the board judges that that is appropriate. This idea that the bank has run out of ammunition is false."
• "The bank can purchase more government securities at different points on the yield curve. It can do more to manage the yield curve than it has currently done. It can also make more noises and commitment to the outlook for interest rates."
• "As a further weapon, the RBA has scope to ramp up buying of government bonds almost indefinitely."
• "As the supply-side restrictions are removed you would expect demand side stimulus, whether it is fiscal or monetary, to have a greater impact."
• "The last thing we want to do is to signal rates are going negative in which case people would get their cash and put it under the bed."
• There is nothing to shock in these comments ahead of next week's RBA decision, with the message in tune with recent commentary deployed by RBA Governor Lowe.