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Australia RBA urges ongoing stimulus for economy

09:40  30 june  2020
09:40  30 june  2020 Source:   msn.com

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  Japan expected to compile next econ stimulus in fall, says PM Abe's ally Japan expected to compile next econ stimulus in fall, says PM Abe's allyTOKYO (Reuters) - Japan is expected to compile a stimulus package to boost the economy in the autumn, as its previous two packages were aimed at preventing firms and households from bankruptcy amid the coronavirus pandemic, a close ally of Prime Minister Shinzo Abe said.

Reserve Bank of Australia ( RBA ) Deputy Governor Guy Debelle speaks at a panel of regulators in Sydney, Australia . With the economy in recession for the first time in 30 years, the government would have reason to keep stimulus going . Official data out on Tuesday showed payroll jobs were

"The Reserve Bank will maintain the current policies to keep borrowing costs low and credit available, and stands ready to do more as the circumstances warrant." The RBA slashed its cash rate to a record low 0.25% in an emergency meeting in mid-March as entire sectors of the economy shut down to

Australia's central bank says the economy will need "considerable" support for some time, and it would be a "problem" if the government ended fiscal stimulus in September as initially flagged.

Australia's fiscal response to the coronavirus pandemic is among the biggest in the world at almost 10 per cent of gross domestic product.

It came after the central bank slashed interest rates to a record low 0.25 per cent and launched an unlimited quantitative easing program in March to help buffer the economy against the fallout of the global outbreak.

The emergency measures have so far been successful in supporting the country's $2 trillion economy, though further support will be required, Reserve Bank of Australia Deputy Governor Guy Debelle said on Tuesday.

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The European Central Bank (ECB) has met the principle of proportionality with its flagship stimulus programme, Germany's finance minister and lawmakers said, ending a legal conflict that threatened to undermine central bank policy. The response to a shock ruling by Germany's top court last month.

Josh Frydenberg, Australia ’s treasurer. The debate over the need for fiscal stimulus in Australia mirrors that elsewhere, with the IMF warning that Europe’s In its quarterly monetary policy review this month, the RBA downgraded a series of economic forecasts, including growth, wages, consumption

"If everything ceases at the end of September then yes that would be a problem," he said, responding to a question following a speech.

"The government's made it very clear in recent days that they are well aware of that and they are considering what they're going to do to address that. We'll find out more in a few weeks' time."

Federal Treasurer Josh Frydenberg is due to provide an update on July 23 on whether there will be changes to the fiscal package, in particular an extension of support beyond the current end-September due date.

With the economy in recession for the first time in 30 years, the government would have reason to keep stimulus going.

Official data on Tuesday showed payroll jobs were still 6.4 per cent below mid-March levels when Australia had recorded its 100th confirmed case of COVID-19.

The recovery in payroll jobs between mid-April and mid-June represents only around 30 per cent of the jobs initially lost to COVID-19, the Australian Bureau of Statistics (ABS) said.

Another worry is that an uptick in cases in Victoria could hurt the economy in Australia's second biggest state, with separate data showing a drop in card spending in the state.

"There is considerable uncertainty over the path from here," Mr Debelle said.

"This uncertainty includes the behavioural responses as health restrictions are eased. There is also considerable uncertainty about the future, which will affect the decisions of businesses and households."

Palaszczuk takes aim at federal ministers as Qld records zero new cases of coronavirus .
One of the suburbs subject to the new stay-at-home order is Ascot Vale in Melbourne's north west. The ABC asked how residents there feel about going into lockdown again.

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