The meeting minutes for October come and gone with with a lot of it’s attention focused on the affects of the covid-19. The Aussie had little to hold on to prior to the meeting minutes and almost nothing to hold onto except sharp knives after the minutes. The AUD/USD has broken its support falling a further 100 pips after the RBA’s Assistant Governor Kent’s speech.
Members agreed that the global economy is in recovery. However they yielded to the fact that this is much dependent on the continuation and speed of the covid-19 recovery. Recovery in Australia remains steady in most of the country. Melbourne being the obvious exception.
Unemployment and underemployment figures are expected to remain high for a while longer although it was stressed that the rate of unemployment has to be of top priority if we want to see any form of recovery in the near term.
Fiscal and monetary support will be needed as high unemployment weighs in on the economy.
The biggest news to take out of the minutes was the discussion of reducing the cash rate and the 3-year yield to zero. This would release some financial pressure to Australian household and hope to inject money back into the economy.
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