Weekend AFR Source Report Getting Some Local Interest

{A weekend piece from the Australian Financial Review has been getting some attention among local desks over the last 24 hours, although there has been a lack of focus on the report from the offshore contingent. As such, it may have flown somewhat under the radar. To recap, the piece noted that "the RBA is considering a more direct form of loosening monetary policy - buying extra federal and state government bonds further along the yield curve beyond the three-year, 0.25 per cent commonwealth yield target that has cost it $61 billion so far. This could be complemented by trimming the 0.25 per cent overnight cash rate target to, say, 0.10 per cent - a relatively token gesture. The RBA would have two likely objectives - putting downward pressure on the elevated currency and reducing long-term federal and state government borrowing costs to encourage fiscal stimulus spending on job-creating infrastructure projects. The RBA could retain the existing three-year yield target at 0.25 per cent while buying more longer-dated bonds to pull down the yield curve."