Australia's central bank is doing what it can to support the economic recovery from the coronavirus pandemic and will maintain policy settings until it meets its employment and inflation goals, Governor Philip Lowe said on Monday.
Australia has been one of the world's success stories in its handling of the pandemic and has quickly emerged from its first recession in three decades with annual economic output already near striking distance of pre-pandemic levels.
The number of people in jobs has also almost returned to levels before the pandemic and "Australia is doing much better than most other advanced economies" across a range of indicators, Lowe said in Melbourne.
"This, however, does not hide the fact that we still have a long way to go," Lowe said in prepared remarks. "The challenges facing us all are large."
The unemployment rate at 6.4% is too high and the economy is operating well short of its capacity with inflation and wages growth both well below the RBA's desired levels.
The RBA this month left its cash rate at a record low 0.1% and re-committed to its three-year yield target to aid the economic recovery.
It expects further progress towards full employment and the inflation target though "it is going to take some time before we reach our goals," Lowe said.
Business investment was one missing piece in the recovery, Lowe said, with many firms putting off plans and seeking to reduce risk on their balance sheets.
"The RBA is doing what it can to support the recovery from the pandemic and will maintain that support until we have achieved our goals for full employment and inflation," Lowe reiterated.
(Reporting by Swati Pandey; Editing by Kim Coghill and Sam Holmes)
