RBA does the apartment bust

From the RBA yesterday:

Thank you for the opportunity to speak at this event. The property industry has come to have an international element to it, as witnessed by today’s event. Property markets are also something we monitor closely at the Reserve Bank and not only for their important impact on economic activity.

Property can also have a substantial impact on the stability of the financial system. The Reserve Bank does not supervise or regulate lending institutions; in Australia that is the responsibility of the Australian Prudential Regulation Authority (APRA). But the Bank does have responsibility to promote the stability of the financial system as a whole. In a stable financial system all the various parts, including banks, other institutions and financial markets, work together to enable the smooth flow of funds between savers and borrowers, so supporting economic growth.

Property and Financial Stability

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About the author

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.