Philip Lowe: Opening statement to the Senate Select Committee on
COVID-19
Opening statement (via videoconference) by Mr Philip Lowe, Governor of the Reserve Bank of
Australia, to the Senate Select Committee on COVID-19, 28 May 2020.
* * *
Good morning and thank you for the invitation to appear before this Committee.
The past three months have been extraordinary ones in the life of our nation and there has been
an unprecedented policy response.
On the economic front, there has been very close coordination between monetary and fiscal
policy, as there should be at times like this. As part of the RBA's contribution to dealing with the
pandemic, we announced a comprehensive package in mid March. The goal is to support the
economy by keeping funding costs low and credit available, especially to small and
mediumsized businesses.
As banker to the Australian Government, the RBA has also processed the many billions of dollars
in government assistance to households and businesses. We have also made sure that the
payments system is working well and that banknote supply is maintained. And we have done this
with around 90 per cent of our staff working from home.
The evidence so far is that our mid-March package is working as expected and it is helping build
the necessary bridge to the recovery. The shape and timing of that recovery depends not only on
when restrictions are lifted, but also on the confidence that Australians have about their own
health and their finances. With the national health outcomes better than earlier feared, it is
possible that the economic downturn will not be severe as earlier thought. Much depends on how
quickly confidence can be restored.
But even as the recovery gets under way, there will still be a shadow cast by the pandemic. As a
country, we will need to turn our minds as to how to move out of this shadow. A reform agenda
that makes Australia a great place for businesses to expand, invest, innovate and hire people
would certainly help. For its part, the RBA will maintain its expansionary settings until progress is
being made towards full employment and we are confident that inflation will be sustainably within
the 2-3 per cent target band.
I look forward to answering your questions.
The Governor was invited to make a brief opening statement to the Committee of no more than
two minutes.