RBA Rate Updates
4.00pm, 18 March 2020: Emergency rate cut 100% certainty TOMORROW
The Reserve Bank of Australia (RBA) is meeting on Thursday this week (19 March) to discuss further stimulus measures to combat the economic impact of the coronavirus.
The prime minister today announced a second economic stimulus and support package, just one week after announcing $17 billion in cash payments, wage subsidies and business support.
The RBA meeting, two weeks ahead of the regular scheduled meeting, will discuss the “inevitability” of an emergency rate cut. The RBA is now expected to slash the official cash rate to 0.25 per cent this week. Futures markets have priced in a 100% certainty of a cut by April (see update below).
Share markets staged a small rally this afternoon to finish less than five per cent down in Australia for the day.
18 March 2020: Lockdown Australia
“Do not go overseas – that is a very clear instruction.”
The prime minister has told Australians to stop travelling overseas. The Australian government has issued a level four “Do Not Travel” warning to every country in the world for the first time ever.
“For those thinking about going overseas in the school holidays, don’t,” said Mr Morrison in a special media conference today on the Coronavirus.
“Don’t go overseas.
“We are looking at a situation of at least six months.”
Virgin Australia has suspended all international flights. Qantas has cut 90 per cent of seats available and has issued a warning that it may lay off employees.
Businesses, such as hotels, bars and restaurants are banned from hosting more than 100 people.
This ban applies to indoor, non-essential gatherings only said the prime minister Scott Morrison in a media conference on Wednesday.
Mr Morrison urged families and businesses to cancel overseas travel and stay at home.
“Life is changing all around the world. This is a once-in-a-100-year event,” said Mr Morrison.
“We are going to keep Australia running.”
Everyone should remain 1.5 metres away from all other people as much as possible but children should continue to attend school.
“The health advice is that schools should remain open.”
Mr Morrison announced support for airlines and the lifting of work restrictions to bring more nurses into hospitals.
The Chief Health Officer, Professor Brendan Murphy, said there were 454 cases of coronavirus in Australia (18 March).
“The majority of new cases are still imported cases or direct contacts of imported cases.”
“We have to be in this for the long haul, we have to have sustainable measures but they have to be serious.
ScoMo’s second stimulus package fails to calm markets
Prime Minister Scott Morrison’s second economic stimulus emergency package of measures announced this morning has failed to reassure investors on the ASX.
The ASX S&P 200 has fallen 5.39% in morning trade to 5008 points (down 285 points). The All Ordinaries has fallen 5% to 5061 points (down 271 points).
Among the big losers today are Afterpay (APT), down $4.91 or 25% to $14.15 and Southern Cross Media (SXL) down 17% to 36 cents.
Another coronavirus rate cut coming tomorrow
Economists are tipping another rate cut from the Reserve Bank of Australia as soon as tomorrow, Thursday the 19 March.
The RBA governor, Dr Philip Lowe announced an unscheduled RBA board meeting and further stimulatory measures to be ann