New Melbourne lockdown forces RBA to restart bond purchases
◆ Australia’s central bank is scrambling to prop up the country’s economy after fresh Covid-19 outbreaks triggered a lockdown in Melbourne, writes Russell Lynch.
The Reserve Bank of Australia is to restart its bond-buying programme following a three-month pause, in an attempt to pump money into the system and peg three-year borrowing costs at a lower level.
Governor Philip Lowe said support would continue for as long as it was needed. The central bank has already cut interest rates to an all-time low of 0.25pc.
Officials rushed to provide stimulus after Daniel Andrews, Victoria’s premier, declared a “state of disaster” and imposed restrictions on more than 5m citizens in state capital Melbourne, including nightly curfews and fines of up to A$20,000 (£10,960).
From tomorrow, citizens across the rest of the state – which accounts for around 25pc of the Australian economy – must also work from home if they can and only leave to buy food, exercise or give essential care.