The Reserve Bank of Australia (RBA) will start a quantitative easing (QE) program (government bond purchases) in early 2021, according to RBC analysts.
The central bank will expand its balance sheet by A$40 billion by buying A$1.5 to 2 billion government bonds each month.
Markets currently expect the central bank to cut rates by 25 basis points to a new record low of 0.5% in February. The central bank has reduced borrowing costs by 75 basis points in 2019.