Savers are feeling the pinch from low interest rates, the head of the Reserve Bank says.
The cash rate has been at a record low of 2.5 per cent for 12 months and is expected to stay there until, at least, early next year.
RBA governor Glenn Stevens acknowledged that the historically low interest rates were affecting those with money tucked away in bank accounts.
"Right now savers are feeling the pinch of very low rates of interest on the safe assets that they hold and they're feeling prompted to accept, in many cases, a little bit more risk to get the return they're seeking," he told a parliamentary committee on Wednesday.
Mr Stevens said there are more savers than borrowers and there will come a point where you don't want to punish the savers too much further.
"That distribution of income is something I think about a lot, although popular commentary regards low interest rate as better that's not necessarily true," he said.
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