FEAR & GREED | Business News podcast

Ask Fear & Greed: Why doesn't the RBA copy Singapore?

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5:35
15 Sekunden vorwärts
15 Sekunden vorwärts

Listener Lynn asks:

It's commonly said that the RBA's use of interest rates for monetary policy is a blunt tool which affects mortgage holders disproportionately.

I've recently heard of an alternative: the Monetary Authority of Singapore manages monetary policy not by using interest rates.

Instead it lets the Singapore dollar rise or fall against the currencies of its main trading partners within an undisclosed trading band, known as the Singapore dollar nominal effective exchange rate.

Why don't more reserve banks do this?

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