AUS: RBA on hold, clearly waiting for Q2 CPI on 31 July before updating their assessment

Tapas Strickland | NAB Markets Research

Key points:

• The RBA kept rates on hold as universally expected
• At the margin, slightly hawkish tweaks re inflation staying higher for longer, but no explicit bias
• Re-inserted “will do what is necessary to achieve that outcome" return inflation to target
• Also added: “while recent data have been mixed, they have reinforced the need to remain vigilant to upside risks to inflation”
• Those insertions give framing flexibility ahead of Q2 CPI on 31 July, which comes before the next August meeting
• Governor Bullock noted recently she was prepared to hike again if inflation reaccelerates or proves stickier, which is consistent with today’s Statement
• However, the RBA remains concerned on the risks of very low growth– with the risk of slower consumption and higher unemployment
• No change to NAB’s view of the RBA cutting rates in November, but risks remains that this may not occur until early 2025 depending on how the data plays out
• Full note to follow the press conference

RBA Track Changes - Click here for a PDF of track changes.

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