What is everyone’s predictions for the RBA?
Punxatawny Phil will just go another 0.5% and meet expectations?
Peachy has been very quite the last few days – probably busy at her job at Coolabah capital
I note the AUD is up this morning so maybe the market expects a 0.75% surprise
what’s interesting for me is that the RBA still hasn’t reversed its QE, so there are excess reserves in the system which would normally force the overnight rate to 0
Instead of using repo and reverse repo, it now has to manipulate the overnight rate by paying interest on excess reserves – how long can this go on for? Are they going to be paying 3 or 4% on excess reserves?
And is that inflationary?