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Bond yields and Aussie dollar fall as market braces for QE – The Australian Financial Review

Australian bond yields have fallen again as the Reserve Bank is set to commmit to switching from targeting yield to targeting quantity.

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“Weve had the term funding facility, theyve cut the cash rate and they’ve cut the three-year bond yield target. The natural next step is quantitative easing.”
Lowering rates helps the economy but can also crimp bank profits by narrowing their margins, analysts warn.
The RBA is expected to commit to buying a quantity of bonds via full-blown quantitative easing or QE rather than target a specific yield should it decide to expand its intervention in fixed income.
Bond yields fell heavily in anti…

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