Mr Macfarlane’s overview of monetary policy in Australia Opening statement by the Governor of the Reserve Bank of Australia, Mr I J Macfarlane, to the House of Representatives Standing Committee on Economics, Finance and Public Administration, in Melbourne, Australia on 17 June 1999. Thank you, Mr Chairman. It is a pleasure to be here in Melbourne again appearing in front of the Committee.
One can readily understand that the purchase of unhedged short-term dollar liabilities to be invested in Thai baht domestic loans (counting on the dollar exchange rate to hold) would at some point trigger a halt in lending by Thailand’s banks. But did the economy need to collapse with it? Had a functioning capital market existed, the outcome might well have been far more benign.