Reserve closely watching rates: Morrison

Paul Osborne
(Australian Associated Press)

 

Treasurer Scott Morrison says he’s confident the Reserve Bank and regulators are keeping a close eye on interest rate settings.

Asked whether he thought the cash rate was too low, Mr Morrison told reporters in Tasmania on Wednesday it was in the hands of the independent central bank.

“The bank has made it pretty clear that they’re not seeing anything moving in the short term and even into next year potentially,” Mr Morrison said.

“What is clear is that until we’re starting to see inflation moving back into the target band, and particularly until we see wages moving into a stronger position of growth, then the bank has made it pretty clear that they’re pretty comfortable where the settings are right now.”

Mr Morrison said the government had been able, through regulators, to “take some of the heat” out of the pressure that would have potentially led to a shift in rates by addressing house price movements, particularly in Sydney and Melbourne.

“I have absolute confidence in Governor Lowe and his entire team in the way that they’ve been managing this issue,” he said.

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