A preview of the Reserve Bank of Australia monetary policy board meeting announcement today and accompanying statement

If you'd like the really short version, scroll to the bottom of my daily data calendar post: Economic data due from Asia today - RBA meeting focus

If you'd like the really, really short version

  • No rate cut today
  • Accompanying Statement likely to be slightly less dovish than previously
  • Now, go and have a coffee/beer/tea/gin/whatever

Westpac's preview is pretty much on the money IMO:

  • The RBA is in "wait and see" mode
  • Assessing the impacts of the rate cuts delivered in May and August
  • Inflation has been the key surprise. Core inflation is now expected to be 1.5% in 2016, undershooting the RBA's February forecast of 2.5% and below the 2-3% target band
  • The Bank still carries a clear 'implicit' easing bias evident in its inflation forecasts ("likely to remain below 2% over most of the forecast period") and rhetoric ("while prospects for growth were positive, there was room for stronger growth, which could be assisted by lower interest rates")
  • We expect rates to be on hold for the remainder of this year and throughout 2017 reflecting an expected emerging comfort around inflation and with Australian economic growth at or above trend, exerting a downward tilt on the unemployment rate.

Commonwealth Bank of Australia have this to say:

  • The meeting should be treated as a "dead rubber"
  • Rates unlikely to move in any direction
  • The RBA has an "implicit" easing bias, the focus is on getting readings of timely economic data and waiting for the next inflation data
  • Watch the accompanying statement for commentary on the Australian dollar (the RBA would like to jawbone it lower)