RBA readies for rise in insolvencies
- He questioned the merit of negative interest rates and pointed to a lack of demand to borrow money, when asked if the central bank considering further subsidising bank lending by adjusting its $135 billion Term Funding Facility bank funding program.
- While the Reserve Bank's actions have been highly effective in stabilising bond markets and lowering borrowing costs, other central banks have taken more extreme measures- such as purchasing corporate bonds, expanding bond purchase programs and exploring negative interest rates.
- The Reserve Bank's deputy governor said liquidators are preparing for a delayed but inevitable rise in business failures in the coming months while uncertain businesses are reluctant to take advantage of historically low interest rates.
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