The head of Treasury is worried about the long term impact of low interest rates on global financial markets.
Treasury secretary John Fraser told a conference in Sydney that the world economy continues to sketch out a relatively weak and uneven recovery from the 2008-2009 global finance crisis in spite of extraordinary monetary policy support.
He said there is an active debate about whether monetary policy has reached the limits of its effectiveness to support growth in the major advanced economies.
A range of different interventions have been tried with mixed results.
"We have been in this experimental stage with monetary policy for more than seven years now. Sadly we will have to await the passage of years before we can pass final judgment," he told the Australian Securities and Investments Commission annual forum on Tuesday.
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"What is clear ... is that unconventional monetary policies have had a pervasive and frankly quite worrying impact on the pricing of financial risk."
He said part of the monetary policy rationale is to encourage private actors to take on more financial risk, but there is evidence that some of the risk-taking could be considered concerning.
Reserve Bank governor Glenn Stevens told the conference while the Australian economy is tracking okay, there's still room to cut interest rates if needed to weather any future storms.
But even at a record low two per cent, the central bank's cash rate is well above other major economies where rates sit just above or just below zero.
