Reserve Bank of Australia meeting minutes.
Headlines via Reuters:
- Board agreed that further steps would need to be taken to normalise monetary conditions in Australia over the months ahead
- Inflation was expected to increase further, before declining back towards the top of the 2 to 3 per cent range in 2023
- Committed to doing what is necessary to ensure that inflation in Australia returns to the target over time
- The resilience of the economy was most evident in the labour market
- Members agreed that there was a material risk that inflation would not return to the target if current policy settings were maintained
- Board felt 25bps increases every meeting this year would be a rapid tightening
- The main argument for an increase of 50 basis points was that the level of interest rates was still very low
- Members noted that either 25 bp or 50 bp rate rise would leave the cash rate below 1%, which would still be highly stimulatory, and that further increases would be required.
This:
- Board felt 25bps increases every meeting this year would be a rapid tightening
The RBA is interested in front-loading rate hikes, they'd likely not continue to go with another 25 at every remaining meeting this year. All subject to inflation developments, of course.
Full text is here:
Minutes of the June 2022 Monetary Policy Meeting of the Reserve Bank Board
We have been hearing from Governor Lowe already during the session:
AUD/USD has traded higher for the session. The sharp wee dip (arrow) is where Governor Lowe said a 4% cash rate by year-end, being priced in by the market, was unlikely:
