Westpac Financial Markets Strategy team on the Reserve Bank of Australia yesterday. This in brief:
- The RBA meeting was seen as slightly hawkish, a slower return to the inflation target, as it remains more persistent and ‘approaches’ rather than ‘hits’ the target.
- OIS markets, which have completely changed their risk profile in the last few weeks, shifted 2-3bp higher but have a cut priced for December 2024.
- Further out the curve, bill futures moved by 20-25bp from high to low, though only a small amount came after the RBA meeting.
- In the RBA press conference, Governor Bullock reiterated the board did consider a rate hike for the August meeting as well as the result being a hold. She said a rate cut is not on the agenda in the near term.
Good stuff.
ICYMI, Justin was all over the RBA yesterday:
- RBA leaves cash rate unchanged at 4.35%, as expected
- RBA governor Bullock: Inflation progress has been slow for a year now
- RBA governor Bullock: A rate cut is not on the agenda in the near-term
