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RBA's Stevens Says Structural, Macroeconomic Policies Should Support Growth

3/19/2012 2:16 AM ET

Recent economic performance in Australia is not too bad, Reserve Bank of Australia Governor Glenn Stevens said Monday.

Addressing the Credit Suisse 15th Asian Investment Conference, he said full range of policies - macroeconomic and structural - need to play their part in seeking that improvement.

Monetary policy can play a role in supporting demand, but it cannot raise the economy's trend rate of growth. Nor can monetary policy obviate the pressure for the production side of the economy to change in response to altered relative prices.

The changes in relative prices are driven by the world economy, governor said. "So in Australia, reorienting our economy, adapting to structural changes and improving productivity performance are challenges we face."

The RBA kept its benchmark cash rate unchanged at 4.25 percent for a second consecutive time in March, as economic growth is expected to be close to trend.

by RTT Staff Writer

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