Kent: Reserve Bank of Australia reviews alternative monetary policy tools to address future risks

Assistant Chair of the Reserve Bank of Australia, Kent, stated that after reviewing alternative monetary policy tools, the Reserve Bank of Australia will be better equipped to address future risks. Kent pointed out that cash rate targets are still the main tool, and other tools can provide additional support during special periods, but they are more complex and bear greater risks. Kent mentioned the Supplementary Monetary Policy Tool Framework for Low Interest Rate Environments released by the Monetary Policy Committee, and stated that when interest rates are low, the committee's tolerance for inflation rates falling below the 2% to 3% target decreases. The central bank will consider lowering the cash interest rate target earlier and more decisively to respond to deflationary shocks.