The Reserve Bank of Australia decided to keep interest rates unchanged at the bank’s meeting this morning, Tuesday, the second of February, at 0.10% levels. While the bank decided to purchase an additional $ 100 billion in bonds issued by the Australian government, states and regions upon the end of the current program in mid-April, at the current rate of $ 5 billion per week. The statement issued by the bank showed that the economic recovery is still dependent on the health situation and on financial and monetary support, as inflation rates are still low and less than the bank’s targets, but the economy has shown a better recovery than the expectations that were at the beginning of the crisis as employment levels rose strongly in the recent period. The unemployment rate fell to 6.6%. The bank expects that the Australian economy will record a growth in gross domestic product of about 3.5% in the years 2021 and 2022 and that the GDP will return to pre-crisis levels by the middle of this year, while unemployment rates are expected to reach 6% by the end of this year and return to levels of 5 .5% at the end of the year 2020. With regard to inflation rates and wage pressures, the bank expects that inflation and wage levels will gradually rise, as the bank expects the inflation rate to remain below the bank’s target levels of 2% in the next two years, as it is expected to reach 1.25% during the current year and rise to 1.5 next year. The Reserve Bank of Australia decided that it will not raise interest levels until inflation rates are close to the bank’s target range, and for this to happen, the rate of wage growth must be higher than it is now, and the bank does not expect these conditions to be achieved before 2024 at least. The Australian Central Bank looked at scenarios related to the Coronavirus and the launch of vaccines and indicated that any negative news related to the virus will delay the recovery and expected progress in reducing unemployment, in contrast to the positive news that will raise the levels of enhancing consumer spending and investment. The Australian dollar is trading down from its highest levels in the Asian session against the US dollar by more than 50 points, with the European markets opening, trading at 0.7610 levels, after testing 0.7665 levels in the Asian session.
23/12/2024
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