RBA Governor Philip Lowe said in a speech that the key to a return to more normal interest rates globally is to improve the “investment climate”. There are two central elements to do so. First is “reduction in some of the geopolitical and other concerns”. Second is “structural measures” that boost people’s “confidence about future economic growth”.
Domestically, Lowe said this year’s three interest rate cuts as “helping” the Australian economy and supporting the “gentle turning point” in growth. RBA is “prepared to ease” further if needed. But he emphasized it is “extraordinarily unlikely that we will see negative interest rates in Australia”. Though, it’s likely that “an extended period of low interest rates” is required.
