The Role of the Central Bank in Liquidity

RBA governor Stephen Grenville distinguished between three different types of liquidity. He said that it was the central bank's role to ensure base money, but ensuring securities don't sell at a discount is arguably not the proper role of the central bank. Jay Powell finally belatedly launched his multi- faceted QE program in 2012 and has since injected $2 billion into Australian financial markets every month. But he could have been better if we'd strap on those securities a couple of months later to come and start better with the rebound in the housing market.