A key reason for removing the LVR restrictions was to eliminate a potential barrier to putting in place a mortgage deferral scheme implemented in response to the pandemic, while a general concern for supporting credit flow provided an additional impetus.
We decided that the policy that we would least regret through this period was to remove restrictions and have to put them back on later; rather than the alternative of keeping conditions too tight and exacerbating a contraction in the financial system and economy.