Goldman Sachs says RBA review has “hawkish implications” for monetary policy

Bloomberg carry the comments from Goldman Sachs on the Reserve Bank of Australia review.

• While the review recommended keeping the Reserve Bank’s 2-3% inflation Inflation Inflation is defined as a quantitative measure of the rate in which the average price level of goods and services in an economy or country increases over a period of time. It is the rise in the general level of prices where a given currency effectively buys less than it did in prior periods.In terms of assessing the strength or currencies, and by extension foreign exchange, inflation or measures of it are extremely influential. Inflation stems from the overall creation of money. This money is m Inflation is defined as a quantitative measure of the rate in which the average price level of goods and services in an economy or country increases over a period of time. It is the rise in the general level of prices where a given currency effectively buys less than it did in prior periods.In terms of assessing the strength or currencies, and by extension foreign exchange, inflation or measures of it are extremely influential. Inflation stems from the overall creation of money. This money is m Read this Term target, it removed the current vague “over time” caveat and instead focused on the 2.5% mid-point of the goal.
• The report also said the RBA’s full employment objective should be given equal weight to containing inflation.

Goldman Sachs says:

• “Together, we view these changes as prioritizing a more precise inflation target over an implicitly shorter, albeit still unspecific, period of time,”
• “The clearer, and implicitly nearer-term, prioritization of the RBA’s inflation/employment targets are likely to have incrementally hawkish implications for monetary policy,”

More at the Bloomberg report, gated

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ICYMI, the headlines from the review:

RBA review recommends a board with more expertise