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Analysts at Nomura offer their thoughts on the upcoming Reserve Bank of Australia’s (RBA) policy decision tomorrow and quarterly Statement of Monetary Policy (SoMP) due to be published this Friday.

Key Quotes:

“We expect the RBA to again announce an unchanged cash rate and anticipate that its press release will contain mixed comments. It is, however, likely to repeat that it expects to achieve its growth and inflation objectives over time, based on current policy settings.  

The press release may provide clues to any forecast revisions in the Quarterly Statement on Monetary Policy (SOMP) released on Friday 9 November. Here, we expect to see an unchanged growth profile, with GDP growth still “a bit above 3%”; a slightly lower unemployment rate forecast and a largely unchanged inflation profile.

We retain a low-conviction call for a 25bp rate hike in August 2019, but note that this will require some evidence of stronger inflation pressures in the interim.”