Excessive exclusive reliance on credit ratings by investors without carrying out due diligence or conducting further own risk assessment is a problem as well. The road map also includes a reflection on the consequences of the originate and distribute model of banks for credit markets. Does it induce wrong incentives?
At its meeting this morning, the Board's assessment was that the Australian economy is moving in the right direction. Over the past year, GDP increased by 3.1 per cent and inflation was around 2 per cent. The unemployment rate is currently 5.3 per cent, which is the lowest it has been in nearly six years.