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The Reserve Bank of Australia (RBA) has released its quarterly Statement on Monetary Policy and the key theme has been a surprisingly confident outlook for the Aussie economy. AUD/USD is currently losing 0.69% today continuing the decline seen in January. 

Key quotes

“The bank’s point forecasts have GDP growth of 2% for 2019, 2.7% for 2020 and 3% in 2021. That compares to 2.3%, 2.8% and 3.1% in the previous SMP released in November.”

“Our forecast is considerably more downbeat, with growth now expected to come in at 1.9% this year, factoring in the impact of bushfires and a preliminary assessment of the impact from the coronavirus.”

“The case for further policy accommodation will become clear to the RBA as its overly-optimistic expectations are not met. We have April pencilled in for the next cut but recognise that the Governor may need more time to be convinced that further action will be required.”