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-Material change in bank funding cost affect financial conditions
By Sophia Rodrigues
SYDNEY (MNI) - A material change in the cost of funds for banks will
contribute to changes in financial conditions and have implications for the
wider economy, Reserve Bank of Australia Assistant Gov. Christopher Kent said
At present there is no such pressure because marginal rates of funding are
a little below the average outstanding rates -- which have declined close to 10
basis points since late last year, Kent said in a speech at a Bloomberg event at
Kent said that despite recent increases in long-term government bond yields
across a range of advanced economies yields on longer-term government debt are
still quite low. Monetary policy remains very accommodative across advanced
economies and inflation remains low.
Given the decline in bank bond spreads since mid 2016 the same is true of
the costs of bank funding in longer-term wholesale debt markets, he said.
Funding costs in short-term debt markets are low, too.
--MNI Sydney Bureau; tel: +61 2-9716-5467; email: email@example.com