In the view of the analysts at Australia and New Zealand Banking Group (ANZ), the Reserve Bank of Australia’s (RBA) Governor Lowe’s speech next Tuesday will be closely eyed for fresh hints on the interest rates outlook.
Key Quotes:
“The Chart of the Week shows that the ANZ Housing Search Index – which measures Google searches for terms associated with home buying – picked a turn in the housing market earlier this year.
It suggests considerable upside in house prices over the coming year, which we think will play a part in boosting retail spending. Along with other data, such as the ANZ Stateometer, this increases our confidence that the economy is gently turning.
We don’t think this turn will be strong enough to obviate the need for an additional rate cut or two, but we think it makes a turn to unconventional monetary measures unlikely in 2020.
All this makes the RBA Governor’s speech on 26 November compulsory listening.
The focus of the Lowe’s address is “Some Lessons from Overseas”, so we don’t expect him to lay out a precise template for RBA action. But we think he could give some insight as to which of the measures implemented overseas would be more appropriate for the Australian economy, if not in the prepared speech then perhaps in the Q&A session.”
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