Bloomberg report on documents it obtained from the Reserve Bank of Australia under Australia's Freedom of Information (FOI) laws.
The docs are recent, from March 2023. They outline 3 options the RBA considered for the cash rate path ahead:
- “Steady Climb” where the cash rate rises by 25-basis-points at each board meeting to 4.8% in August, a level the authors considered to be about 1 percentage point above a “reasonable nominal neutral rate estimate”
- “Front-Loaded Path” where the rate jumps in 50-basis-point increments at each meeting to 4.8% in May
- “Flat” where the cash rate is left at 3.35% — the level it stood at in February — until mid-2024
And concluded:
- "All cash rate paths bring inflation within the target band by the end of the SMP forecast horizon,” the unidentified authors said, referring to the RBA’s quarterly Statement on Monetary Policy.
- “The ‘steady climb’ and ‘front-loaded’ paths are the quickest to return inflation to the target band in late-2024.”
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No, I don't know how much the boffins got paid to do this.
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Since March the RBA has taken the cash rate to 3.85%. The Bank next meets on June 6 and Reserve Bank of Australia Governor Lowe speaks the next day.
Here is the link to the Bloomberg report for more, gated.
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Currently:
