RBA Monetary Policy Statement: Further rate hikes may be needed
|The RBA Monetary Policy Statement released by the Reserve Bank of Australia is out as follows:
Projections are based on a 3.75% rate peak, with rates dropping to 3% by mid-25.
Further monetary policy tightening may be required.
Energy prices will contribute considerably to inflation in the coming year.
We are steadfast in the commitment to return inflation to target.
The board intends to keep as much employment gains as possible.
The longer inflation remains above target, the higher the likelihood of a price-wage spiral.
Goods disinflation has been minimal thus far, but energy price inflation will remain high this year.
Forecast cpi inflation of 4.5% in 2023, 3.2% in 2024, and 3.0% in mid-2025.
Forecast trimmed mean inflation of 4.0% by the end of 2023, 3.1% by the end of 2024, and 2.9% by the middle of 2025.
China is projected to easily meet its 5% growth target this year.
Forecasts GDP growth of 1.2% in 2023, 1.7% in 2024, and 2.1% in mid-2025.
AUD/USD update
H1 chart above and M5 chart below.
AUD/USD has been given a boost on the statements towards 0.6717, Tuesday's high.
About the RBA Monetary Policy Statement
The RBA Monetary Policy Statement released by the Reserve Bank of Australia reviews economic and financial conditions, determines the appropriate stance of monetary policy and assesses the risks to its long-run goals of price stability and sustainable economic growth. It is considered as a clear guide to the future RBA interest rate policy. Any changes in this report affect the AUD volatility. If the RBA statement shows a hawkish outlook, that is seen as positive (or bullish) for the AUD, while a dovish outlook is seen as negative (or bearish).
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.