Surging Money Rates 10,000 Miles From Fed Flag Warning for RBA
- ‘Structurally higher’ rates could affect RBA policy outlook
- Rising dollar-funding costs having an impact on Aussie banks
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There’s fresh reason to think that Australia’s central bank, as the country’s treasurer anticipates, may not be raising interest rates anytime soon.
Short-term borrowing costs in Australia’s financial system have been surging, and will tighten financial conditions if it lasts, even without action by policy makers. The jump in a key benchmark, the three-month bank-bill swap rate, has been something of a head scratcher, though most explanations center around the impact of overseas dynamics: