The Reserve Bank of Australia left the door ajar to increasing its weekly bond buying program in light of the worsening COVID-19 outbreak in its monthly meeting at the start of August, minutes published on Tuesday show.
The central bank held firm on its previously stated shift to weekly $4 billion in weekly bond purchases despite the worsening outbreak, going against the grain of economist estimates that anticipated a small increase in quantitative easing.
“The bond purchase program will continue to be reviewed in light of economic conditions and the health situation,” the minutes state.
“The Board would be prepared to act in response to further bad news on the health front should that lead to a more significant setback for the economic recovery,” the minutes stated.
The Sydney outbreak has significantly worsened since the meeting at the start of the month with daily infections setting new records in the past few days.
“The current virus outbreaks and lockdowns had interrupted the recovery and many households and businesses were facing difficult conditions,” the minutes stated.