Reserve Bank of Australia statement is due at 0430GMT
Earlier previews:
- RBA preview - markets have a 50/50 split on these two options
- RBA monetary policy decision on Tuesday, RBNZ on Wednesday - what to expect
- Westpac sees asymmetric risk for the Australian dollar on the RBA
- Morgan Stanley like the AUD, say no RBA rate cut next week
- AUD: Beset by weak domestic data, calls for imminent RBA rate cuts ... buy it anyway!
- Eight reasons why the RBA will cut rates this week
- Westpac says the case 'indisputable' for an RBA rate cut ... but not in May
- AUD - NAB CEO has dismissed calls for an RBA interest rate cut
Ahead of the RBA we have Australian data due, both of these at 0130GMT:
OK … without any further ado, RBA preview via TD. TD are expecting a cut but only narrowly, they say a no cut but easing bias announcement is almost just as likely. TD cite:
- The decent Q1 core CPI miss & consecutive soft GDP prints suggest the RBA need not wait for a trend pickup in unemployment in order to cut (today).
- We expect an explicit easing bias if the RBA keeps rates on hold. OIS is then likely to price the next cut in August if the RBA focuses on weaker inflation.
TD add on Friday's Statement on Monetary policy:
- The market could see a dovish cut if more cuts lie ahead via significant downgrades to GDP/CPI forecasts (confirmed in Friday's SoMP). We look for -0.5pp for GDP & -0.3ppt for core CPI in 2019.
