Economics
Australia Small Business Failures Expected to Rise
- Regulators have other mechanisms to handle lending if needed
- SME’s loan deferrals peaked at 13% in June, are now around 1%
The RBA and government implemented a range of measures to assist small businesses, which bore the brunt of the pandemic’s impact as cafes, restaurants and the arts and recreation sectors were forced closed.
Photographer: Brent Lewin/BloombergThis article is for subscribers only.
Reserve Bank of Australia Assistant Governor Christopher Kent said monetary policy shouldn’t try to control asset prices, and regulators have alternative mechanisms to deal with deteriorating lending standards if needed.
Responding to a question after a speech Wednesday on whether stimulus might be pulled back quicker if asset prices over-inflate, Kent said rising prices are an important part of policy transmission, but the Council of Financial Regulators is closely monitoring the issue.