Philip Lowe: Panel remarks – Conference on “Central Bank independence, mandates and policies” Panel remarks by Mr Philip Lowe, Governor of the Reserve Bank of Australia, at the Conference on Central Bank Independence, Mandates and Policies, organized by the University of Chile, Webinar, 22 October 2021. * * * Thank you for your invitation to participate in this conference.
Some part of that effect comes through a wealth effect: as housing prices fall, homeowners' wealth declines, which reduces their spending. Some part of the effect comes through the lower housing turnover that has accompanied the decline in housing prices. Housing turnover is around its lowest level in more than 20 years. When people move house, they spend more on things like household furniture.