RBA Governor Philip Lowe said that the economy could be “better than the baseline” scenario as forecast earlier this month. RBA projected that GDP could contract by -6% this year with unemployment rise to 9%. “With the national health outcomes better than earlier feared, it is possible that the economic downturn will not be as severe as earlier thought. Much depends on how quickly confidence can be restored,” he added.
Lowe also noted that the monetary stimulus package was working as expected. If we had to do more we could purchase more government bonds. But as things stand at the moment, we don’t see the need to doing more,” he said. He also reiterated negative interest rates were “extraordinarily unlikely”.