RBA minutes, Lowe speech puts kibosh on negative rates, MMT

21 July 2020

 

Summary: RBA minutes reveal discussion of negative rates, financing fiscal deficits directly and indirectly;  negative rates may limit credit supply, increase savings ratio; money creation comes at a cost, “no free lunch”;   The Reserve Bank of Australia left its cash rate and 3-year ACGB targets at 0.25% at its July meeting. The minutes of that meeting have now been released. While they were largely a rehash of previous months’...

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