The RBA cut interest rates again to a new all-time low of0.10% on Melbourne Cup day. This was in addition to a further commitment to purchase $100b of 5-10 year bonds to keep interest rates low for the next 6mths. This action suggests the RBA is unlikely to cut rates further – so no negative interest rates in Australia.

The chart shows how large the Australian program is relative to the size of our economy. The Australian program is forecast to be larger than Sweden’s, but smaller than other major economies.

The US Federal Reserve met last week, and left interest rates alone. The US economy continues to grow and the unemployment ratecontinues to fall to 6.9% with a 2.2m increase in employment. They continue towatch Covid-19 cases climb however, and are readying to increase the QEstimulus program should it be required.

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