RBA maintains record low rate while staunchly protecting bond market

Yesterday afternoon the Reserve Bank of Australia announced that it will hold the official cash rate (OCR) at 0.1%.  The rate has remained at this record low for 4 consecutive months now.

RBA’s justification for holding rates

As outlined in the statement provided by RBA Governor Philip Lowe, the global economy is now in a more promising position than it was a few months ago. The ongoing rollout of vaccines is creating less uncertainty looking forward.

Governor Lowe also acknowledged the increase in global trade and commodity prices. However, the recovery remains highly contingent on COVID-19 and global monetary support.

The improving unemployment rate and increased spending also indicate a strengthening economy for Australia….