The past week in monetary policy saw just one bank lift rates; Jordan +50bps to 5.00%, and two banks cut rates; Belarus -200bps to 43.00%, and Indonesia -25bps to 5.75%. Meanwhile the banks that held rates unchanged were: Australia 4.25%, UK 0.50%, EU 1.00%, South Korea 3.25%, Serbia 9.50%, Iceland 4.75%, Poland 4.50%, and Peru 4.25%. Also making news was the Bank of England adding another GBP 50 billion to its quantitative easing program.
Some of the key quotes and comments from the central bankers that announced monetary policy decisions are listed below:
- Reserve Bank of Australia (held rate at 4.25%): "At today's meeting, the Board noted that interest rates for borrowers have declined to be close to their medium-term average, as a result of the actions at the Board's previous two meetings. With growth expected to be close to trend and inflation close to target, the Board judged that the setting of monetary policy was appropriate for the moment. Should demand conditions weaken materially, the inflation outlook would provide scope for easier monetary policy."
- Bank Indonesia (dropped rate 25bps to 5.75%): "This decision was made as a further step to boost Indonesia's economic growth amidst decreasing performance of the global economy, with the priority remains on achieving inflation target and exchange rate stability."
- Bank of England (held rate at 0.50%, added 50B to APP): "In the light of its most recent economic projections, the Committee judged that the weak near-term growth outlook and associated downward pressure from economic slack meant that, without further monetary stimulus, it was more likely than not that inflation would undershoot the 2% target in the medium term."
- European Central Bank (held rate at 1.00%): "Inflation is likely to stay above 2% for several months to come, before declining to below 2%.