RESERVE Bank Governor Philip Lowe says he is ready to take further action to support the Australian economy, as coronavirus takes its toll on business and trading.

In a statement this week, Mr Lowe said financial regulators and the Australian government were working closely together to help ensure Australia’s financial markets continued to operate effectively and that credit was available to households and businesses.

“Australia’s financial system is resilient and it is well placed to deal with the effects of the coronavirus,” Mr Lowe said.

“At the same time, trading liquidity has deteriorated in some markets.”

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Mr Lowe said the Reserve Bank was ready to buy Australian government bonds in the secondary market to support the smooth functioning of that market, which “is a key pricing benchmark for the Australian financial system”.

“The Bank will also be conducting one-month and three-month repo operations in its daily market operations until further notice to provide liquidity to Australian financial markets,” he said.

“In addition the Bank will conduct longer term repo operations of six months maturity or longer at least weekly, as long as market conditions warrant. The Reserve Bank and the AOFM are in close liaison in monitoring market conditions and supporting continued functioning of the market.”

Mr Lowe said the Bank would announce further policy measures to support the Australian economy on Thursday of this week.

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