Analysts at TD Securities point out that the Australian economy has witnessed a decent suite of price and activity data reports.
“The most significant event of 2018 was the slide in house prices, a phenomenon that was deliberately engineered by financial regulators, not monetary policy. Now that 2019 is an election year, the negative impact on wealth and possibly consumer spending has become top of the mind for the government, not just the RBA.”
“In the meantime, significant infrastructure spending and strong trade flows combined are contributing up to 2%pts to annual GDP growth. The consumer only needs to add another 1%pt to achieve above-trend growth.”
“We are of the view that OIS at 50% priced for a cut by November is overdone. However, the markets will not unwind this pessimism until it is confirmed that core inflation is on track at 1¾%/y and wages growth continues to tick higher.”
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.