Interest rate cut likely as virus spreads | The Courier

RBA could cut rates for 2nd time in March | The Canberra Times

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Interest rates are expected to be cut to record lows as Australia’s central bank scrambles to respond to the coronavirus pandemic. The federal government is also working on new stimulus measures to prevent the outbreak shutting down large chunks of the economy. The Reserve Bank of Australia will hold an emergency meeting on Thursday afternoon. Economists expect the central bank to slash the cash rate to 0.25 per cent, which would be the lowest in Australia’s history. RBA governor Philip Lowe is also expected to release details of an asset purchasing program, including buying government bonds. The bond-buying program would flood Australia’s financial system with extra cash to keep the economy functioning smoothly during the crisis. The spread of the coronavirus in Australia and across the world has cemented the likelihood the national economy will fall into recession this year, as consumer spending and productivity slumps. Economists have warned the economy could contract by as much as two per cent in the June quarter, risking a rise in unemployment to almost eight per cent, from around five per cent now. The latest jobless figures will be released on Thursday morning. “Workers in industries such as tourism, education and retail are already being laid off and this will only worsen under travel bans, cancellations of large events and social distancing,” ANZ said in a research note to clients. Finance Minister Mathias Cormann says the upcoming government economic package, which will follow $17.6 billion worth of support announced last week, will be significant. The government is aiming for business-focused measures that cushion the impact of the crisis and may include cash payments or loans. The first stimulus package included $750 one-off payments for pensioners and welfare recipients, as well as grants of up to $25,000 for small business. The Australian Chamber of Commerce and Industry has recommended a range of measures for the second package, including help to keep workers employed and concessional loans to assist with cash flow. Australia’s small business and family enterprise ombudsman Kate Carnell has urged the government to include sole traders in its support package, as they can’t access the grants on offer. Senior Labor figure Penny Wong said the second package needed to include help for casual workers. “(They) face a dreadful decision if they are asked to isolate, of either doing the right thing by the community and public health, but not being able to put food on the table for their families,” she told ABC News. “We should not put them in that position.” Australian Associated Press

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Interest rates are expected to be cut to record lows as Australia’s central bank scrambles to respond to the coronavirus pandemic.

The federal government is also working on new stimulus measures to prevent the outbreak shutting down large chunks of the economy.

The Reserve Bank of Australia will hold an emergency meeting on Thursday afternoon.

Economists expect the central bank to slash the cash rate to 0.25 per cent, which would be the lowest in Australia’s history.

RBA governor Philip Lowe is also expected to release details of an asset purchasing program, including buying government bonds.

The bond-buying program would flood Australia’s financial system with extra cash to keep the economy functioning smoothly during the crisis.

The spread of the coronavirus in Australia and across the world has cemented the likelihood the national economy will fall into recession this year, as consumer spending and productivity slumps.

Economists have warned the economy could contract by as much as two per cent in the June quarter, risking a rise in unemployment to almost eight per cent, from around five per cent now.

The latest jobless figures will be released on Thursday morning.

“Workers in industries such as tourism, education and retail are already being laid off and this will only worsen under travel bans, cancellations of large events and social distancing,” ANZ said in a research note to clients.

Finance Minister Mathias Cormann says the upcoming government economic package, which will follow $17.6 billion worth of support announced last week, will be significant.

The government is aiming for business-focused measures that cushion the impact of the crisis and may include cash payments or loans.

The first stimulus package included $750 one-off payments for pensioners and welfare recipients, as well as grants of up to $25,000 for small business.

The Australian Chamber of Commerce and Industry has recommended a range of measures for the second package, including help to keep workers employed and concessional loans to assist with cash flow.

Australia’s small business and family enterprise ombudsman Kate Carnell has urged the government to include sole traders in its support package, as they can’t access the grants on offer.

Senior Labor figure Penny Wong said the second package needed to include help for casual workers.

“(They) face a dreadful decision if they are asked to isolate, of either doing the right thing by the community and public health, but not being able to put food on the table for their families,” she told ABC News.

“We should not put them in that position.”

Australian Associated Press

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