REFILE-Very material economic contraction likely in Australia – c.bank minutes

Australia, NZ hit fresh closing peaks on positive global data, trade deal

(Corrects day in first paragraph to Wednesday, not Tuesday)

SYDNEY, April 1 (Reuters) – Australia’s central bank was worried about the potential for a “very material contraction” in economic activity when it decided to foray into quantitative easing in an out-of-cycle meeting in March, minutes released on Wednesday showed.

The Reserve Bank of Australia (RBA) held an ad-hoc meeting on March 18 when it reduced its cash rate to a record low 0.25% and embarked on an “unlimited” government bond buying programme.

The RBA said it was not possible to provide an updated set of forecasts for the economy while “it was likely that Australia would experience a very material contraction in economic activity, which would spread across the March and June quarters and potentially longer.”

The number of coronavirus cases in Australia now exceeds 4,500 with 20 deaths. (Reporting by Swati Pandey; Editing by Christian Schmollinger)

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