RBA's Governor Lowe: Flexible inflation target remains the right monetary policy

RBA's Governor Lowe is crossing the wires, speaking before the House of Reps Standing Committe on Economics Today, noting that flexible inflation target remains the right monetary policy. The Aussie is solidly bid on the back of the FOMC outcome.

Additional headlines

Importantly, the drag from the fall in mining investment will come to an end

Low wage growth and lower commodity prices have meant that cpi inflation has been quite low over recent times

If these increases were to be sustained then we could look forward to the drag on national income from falling commodity prices coming to an end

Recent news on commodity prices has been a bit more positive than it has been for a while

Story on income growth has been less positive, with growth in nominal gdp being disappointing

Our judgement is that past easing in monetary policy is supporting jobs and economic activity

Board very conscious that rate cuts mean lower interest income for savers

Economy is adjusting reasonably well to the unwinding of the biggest mining investment boom in more than a century

Recent gdp data a little above most estimates of trend growth in our economy.

We expect the economy to continue to be supported by low interest rates and the depreciation of the exchange rate since early 2013

Housing situation is somewhat more comfortable than it was a year ago, although we continue to watch things carefully

We expect the economy to continue to be supported by low interest rates and the depreciation of the exchange rate since early 2013