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From the Australian Financial Review: Lower rates can't drive confidence: RBA's Glenn Stevens (gated)
A gated article from the Australian Financial Review, but in brief:
- Stevens said the single most important driver of the economy, a recovery in confidence, is not something that can be provided by lower official interest rates
- some “encouraging signs” on sentiment … (but) many businesses are preferring to return dividends and capital to shareholders over investing in fresh growth… “Any plans for growth that might be in the top drawer [of companies] remain hostage to uncertainty about the future pace of demand”
- Reiterated the bank's long-standing view that the cash rate is likely to remain low
- Expressed confidence that at some point people would become convinced of a recovery
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Earlier posts:
- Reserve Bank of Australia (RBA) Stevens testimony: Says RBA is allowing time for measures to take effect
- RBA Stevens Q&A: Says risk of AUD fall is underappreciated . His Q&A session is still ongoing
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