Rates left unchanged as expected and the highlights of the statement follow;
- Prudent to have period of stability for interest rates
- AUD high by historical standards
- AUD offering less assistance than it might in balancing growth
- Sees smaller increases on resource exports in coming quarters
- Sees more moderate growth in consumer demand
- Strong expansion in housing construction underway
- Inflation to remain within target over next two years
- Sees subdued government spending
- Somes signs of moderation in house price growth
AUD/USD breaks 0.9450 to 0.9453
Full statement here
In the full statement they have confirmed that they are seeing resource investment spending declining significantly and that’s a change from last month where they said it “was set to decline significantly”. They also warn that growth will be below trend over the year ahead. Credit to businesses has picked up, which is good news.
It looks like the market might have been waiting to see if there was more of a dovish stance from the RBA. They weren’t and so we popped. The 0.9460 highs are still intact and unless that goes we’re likely to stay in the well known range.