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Weekly Economic Commentary

Weekly Economic Commentary

Categories: General

I must admit to feeling a little hoarse and tired following a couple of epic semi-final encounters last week and the anticipation of another trans-Tasman rivalry in the World Cup Cricket final on Sunday at the MCG. However, the elation that this writer feels following a fantastic and convincing Aussie victory is tempered by the other significant non-economic news last week, namely the loss of 150 passengers and crew (including two Australians) following the crash of a Germanwings Airbus A320 in a remote region of the French Alps – the worst air disaster in France in more than three decades. 

Turning to markets, the Reserve Bank’s latest half-yearly Financial Stability Report was released last week with very little fanfare. No additional clarity was given to macro-prudential measures, however it's clear that the maintenance of lending standards continues to be a key focus of the regulator. The RBA reiterated its concerns over housing, especially in the investor space. 

Further, the RBA and the regulator are comfortable with the status quo, expecting these macro-prudential measures to take the heat out of the more speculative elements of the housing market, leaving the door open for further rate cuts in the coming months.

Source: Rural Bank

 

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