It's a big week from the Reserve Bank of Australia, with the monetary policy meeting Tuesday and the quarterly Statement on Monetary Policy published on Friday
I've posted two previews up already:
This now via Westpac:
- The Board is certain to keep rates on hold.
- In previous years November has been a very popular month for changing rates but not this year.
- Rates have not been adjusted in November since 2011. However in the six years from 2006 to 2011 there was a rate move at every November Board meeting. In recent times, November has also been a popular "target" for market expectations of rate moves. Following the rate cut in August last year, markets were confident that there would be a follow up cut in November - Westpac was not convinced with that view and the November meeting passed with no change.
- Some months ago, offshore investors assured me that the Board would adopt a tightening bias at the November meeting. That prospect has since dissipated.
And, more from them:
- Since the last meeting in October, momentum in the labour market has remained strong, but household consumption has disappointed materially. This is despite an improvement in consumers' expectations of the economic outlook. Instead, persistent concerns over family finances are limiting discretionary spending.
- On the housing market, there has been a clear deceleration in Sydney, but Melbourne has held up. Arguably it is still too early to assess the full effect of March's regulatory reforms.
- Poignant in the October minutes was the clear message that the RBA is not beholden to policy developments (rate hikes) abroad. To our mind, below trend GDP growth and benign inflation will keep them on hold in 2018 and 2019.
(bolding mine)
