Analysts at Goldman Sachs offer their expectations from the Reserve Bank of Australia (RBA) monetary policy decision over the coming year.
Key Quotes:
“Absent a steady rise in the unemployment rate over a couple of months (not our base case), rates on hold in 2020 now looks to us the most likely scenario — particularly given Governor Lowe’s renewed concerns around low rates, house prices & financial stability.
Downgraded its GDP forecast for Australia, citing bushfire and coronavirus drag in Q1 to 2.4% vs. 2.7% previous.
Then a quick rebound from Q2
There are risks to their projections, skewed to the downside and considerable uncertainty.
2020 GDP could be as weak as 1.7% in a scenario where the rate of new viral infections does not peak until sometime in 2Q2020.”
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