Australian Markets Weekly – RBA to hold the line on rates

Domestic economy still arguing for unchanged RBA policy

RBA to keep monetary policy unchanged at tomorrow’s Board meeting – the key question will be whether the Bank still sees prospects for a pick-up in growth
Global market volatility likely makes the RBA watchful but global outlook has not materially changed
Australian labour market outperformance a continuing centrepiece of discussion
The Board has time to continue reviewing domestic economic signals as global economic/financial developments evolve
NAB expects the Reserve Bank to remain on hold through this year
Friday’s quarterly Statement on Monetary Policy likely to reveal little change in Australia’s key macroeconomic forecasts
Inflation continues to provide scope to ease if required. CPI forecasts to be little altered, though RBA to recognise greater exchange rate pass-through in latest quarter
RBA to reduce unemployment rate forecast – a key question is whether non-mining growth is stronger than recognized and/or potential growth is even lower than estimated

For full analysis, download report:

For further FX, Interest rate and Commodities information visit nab.com.au/nabfinancialmarkets

Business Research & Insights