The RBA minutes: Board prepared to ease policy further if needed to support growth, jobs

The Reserve Bank of Australia came with the Minutes for the RBA Board’s 1 October meeting. The RBA is prepared to ease further if needed to support growth and jobs. AUD/USD is a touch lower (-0.15%) on the main take away points as follows:

The Minutes

• Board judged case for easing at Oct meeting outweighed arguments against a move.
• Board prepared to ease policy further if needed to support growth, jobs.
• Reasonable to expect extended period of low rates would be required.
• Board members noted trend to lower rates globally.
• Discussed possibility rate cuts might have less impact than in past.
• Judged lower rates would still have an impact through the A$.
• Members noted export demand had been supported by lower level of the A$.
• Discussed risk that low rates would over-inflate home, asset prices.
• Saw limited risks of excessive borrowing for now, but warranted monitoring.
• Board discussed case for keeping rate cuts in reserve for emergencies.
• Decided lower level of rates best way to lessen impact of any negative shocks.
• Mining, housing sectors seemed to have reached “turning points”.
• No sign as yet that household consumption responding to rate cuts, tax rebates.
• Strong jobs growth being met by equally strong increase in labour supply.
• Leading indicators point to slowdown in jobs growth in quarters ahead.
• China-US trade, tech disputes a significant downside risk to global outlook

About the minutes:  

The minutes of the  Reserve Bank of Australia  meetings are published two weeks after the interest rate decision. The minutes give a full account of the policy discussion, including differences of view. They also record the votes of the individual members of the Committee. Generally speaking, if the  RBA  is hawkish about the inflationary outlook for the economy, then the markets see a higher possibility of a rate increase, and that is positive for the AUD.