Tuesday, May 7, 2013

OMFG!

The Reserve Bank has cut interest rates to a crisis level of 2.75%! Why? Why?

Policy Interest Rates – Advanced Economies graph

"So with all these things, at least at the moment, my sense is that the appropriate interest rate for the economy’s circumstances is in fact the pretty low one we have, not because we face an emergency like we did back then but because we face some other forces of a more slowly evolving nature that combine to mean that the correct rate really is lower than it was a couple of years ago. So I am not uncomfortable with this setting of rates." - RBA Guvnor Stephens

Note: The RBA chart pack is updated monthly and always worth a browse: Chart Pack

Update: Hitler finds out about negative interest rates

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