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Minutes released by the RBA yesterday revealed the board did consider reducing rates further earlier this month before deciding to pause for an evaluation of existing measures in place.
According to the minutes of the March monetary policy meeting the members of the RBA board see a reasonable case for reducing the cash rate further.
However they noted that the easing taken in recent months was large by historical standards and needed time for its effect to be gauged – along with the government’s substantial fiscal measures.
“On balance... having made a major change to monetary policy over the preceding several meetings in anticipation of weak economic conditions, the best course for this meeting was to leave the cash rate unchanged,” the board said.
The minutes also indicated that further reductions are likely, but just when they come will remain to be seen.
“Members believed this would leave adequate flexibility for policy at future meetings,” the board said.
