Here it comes, via the AFR:
“There remain pressures that have built up again over the last few months,” Mr Morrison said in Canberra on Monday.
Speaking after returning from the Group of 20 finance minister’s meetings in Germany on Friday and Saturday, Mr Morrison said it was up to regulators – which are led by the Reserve Bank of Australia and the Australian Prudential Regulation Authority – to be “using the levers that they have”.
“I had discussions with the Council of Financial Regulators and we’ve been looking at these issues on the investor side, on the demand side, quite significantly, and that is the appropriate place for that discussion to take place,” he said. The council is chaired by the RBA and includes APRA, ASIC and federal Treasury.
“They’ve done it before wisely and it’s for them to take any further action that they see as necessary.”
ASIC chairman Greg Medcraft attended the Council of Financial Regulators meeting and backed macroprudential measures to manage a build up in housing risks.
“I have been saying for a while that I thought it was a bubble and other people are catching up now,” he said on Monday.
“We focused on the housing market and clearly the issue is if you raise interest rates that’s a big tool but then you effect the whole economy.”
“It’s Sydney and Melbourne [where prices are rising] so I think macroprudential are useful tools.”
Looks a done deal now. Go for a 5% cap, APRA, not 7%. That’ll give the RBA room to cut.