National Australia Bank (NAB) joined the other top Australian banks, the ANZ, Westpac and Commonwealth Bank, in stepping up the Reserve Bank of Australia (RBA) rate cut calls, citing sluggish economic growth and a lack of fiscal support, Reuters reports.
NAB, which previously forecast only one rate cut next year, said it now predicts two - in February and in June - which would take the cash rate to 0.25%.
NAB’s economists said: “We think monetary policy will have to continue to do the heavy lifting given that there has been little response to date on the fiscal front. At this point, we see an increased risk of a move to ‘unconventional’ policy in H2 2020 should the labour market deteriorate more significantly than we forecast.”
The AUD/USD pair remains near daily lows of 0.6822, down -0.31% so far. The Aussie looks vulnerable amid increased RBA rate cut and QE calls after Australia’s Q3 GDP growth slowed more-than-expected.
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