RBA is upbeat, expecting GDP growth to pick up gradually - TDS

Sandeep Kanihama FXStreet Contributor

Analysts at TDS explain that the RBA Minutes from the 7^th March meeting confirm the RBA’s reluctance to cut the cash rate with the RBA needing to balance an optimistic outlook on the domestic and global economy against growing imbalances/risks in the housing market.

Key Quotes

“Overall the RBA is upbeat, expecting GDP growth to pick up gradually, downplaying the recent capex miss, but is aware that low interest rates are driving a pick-up in borrowing and build up in housing risks. Given the Bank mentions a higher AUD as potentially complicating the transition post the mining boom, rate hikes appear unlikely anytime soon, particularly with spare capacity and wage pressures remaining subdued.”

“Housing data came in strong today, with Dec qtr House prices gaining, at +7.7%/yr (mkt: 6.3%).”

Author

Sandeep Kanihama

FXStreet Contributor

Sandeep Kanihama is an FX Editor and Analyst with FXstreet having principally focus area on Asia and European markets with commodity, currency and equities coverage. He is stationed in the Indian capital city of Delhi.

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