If anything, the growth outcomes over the past year, as measured by real GDP or the trend in unemployment, have been a bit better than expected. In easing policy, the Board has been conscious that interest rates are already low – very low in fact, by historical standards. These low rates are, in part, a consequence of what has been happening abroad.
Monetary settings elsewhere in the world have affected international capital flows and exchange rates, and interest rates here in Australia too. The Board has also been conscious that the low rates mean low returns for many savers. In addition, the Board has paid close attention to developments in household balance sheets and the housing market.