The RBA left the cash rate on hold as expected at 1.50% and there were no major changes to the accompanying statement, which sounded upbeat on the global economy, albeit with some caution on EM economies and trade, notes the research team at TDS.
Key Quotes
“RBA noted expansionary financial conditions, with data consistent with their GDP forecast to average a bit above 3% in 18 and 19. Uncertainty on the outlook for household consumption was noted. Comments on AUD were benign, with the RBA noting that the currency has depreciated a little.”
“They noted low wage growth, but that the rate of wage growth has troughed. Inflation is expected to remain low for some time, with a gradual pick up expected. CPI is forecast to be a bit above 2% in 2018. Overall no urgency at all from the RBA, with the key word being “gradual” in terms of a return of reducing unemployment and returning inflation to target.”
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