Australia CB to cut rates

    1907

    SYDNEY- Australia’s central bank is expected to cut key rates to a historic low of 0.1 percent at its monthly policy meeting next month, a majority of economists polled by Reuters showed, as it looks to boost jobs and economic growth.

    As many as 21 of the 25 surveyed, or 84 percent, expect a 15 basis point cut to 0.10 percent at the Reserve Bank of Australia’s (RBA) Nov. 3 board meeting. One economist predicted a 10 basis point cut to 0.15 percent while the remainder forecast no change.

    Analysts also predict the RBA would expand its government bond-buying program.

    “We now think that a proper Quantitative Easing (QE) is simply a matter of time and we would not rule out a near-term announcement,” said RBC economist Su-Lin Ong.

    ANZ economists expect a A$100 billion of QE, targeting Australian government bonds with maturities between five and ten years.

    “This number, combined with the bond purchases it has already done, would be consistent with the size of the initial QE programs of other central banks,” the economists said.