Transcript of Question & Answer Session How Developments in International Financial Markets Shape Financial Conditions in Australia

Thank you so much, Penny. And thank you for taking questions. We’ve just got, two minutes left, so probably got time for one. In previous years, your RBA colleagues have spoken at this conference. They’ve highlighted the role of international investors in Australian securitisation markets. Could you elaborate on how global financial conditions affect the participation of these investors and what that means to overall financial conditions in Australia?

I’m sure I don’t need to explain this to the people in this room. But strong offshore demand lowers funding costs for domestic lenders, including non-banks, and that supports much easier financial conditions than otherwise. And the message my colleagues in domestic markets have continued to hear in 2025 is one where offshore investors have been continuing to contribute to the strength of demand for Australian securitised products, alongside the structural deepening of demand for Australian fixed income in general. The share of ABS that is foreign owned has stayed broadly stable though, indicating that domestic demand has also held up.

So overall, when we get these environments where risk appetite is high, that does spill over into domestic financial conditions here. But the exchange rate also acts as a bit of an offset.

Thank you so much for your insights. It’s always a highlight of the conference. Please join me in thanking Penny again.