Analysts at Rabobank point out that the RBA left rates on hold at 1.50% yesterday as expected but added some key extra words to their copy-and-paste statement: “One continuing source of uncertainty is the outlook for household consumption”.
“Given household debt is now 194% of GDP, is that a surprise? Certainly it implies the RBA will not be following rapidly where the Fed still appear to be leading. That’s even more the case now that the geniuses at the ABS are about to revise the basket of goods and services for Aussie CPI (which they labour to produce all of four times a year), with strong suggestions that this will mean weaker prints going forwards. In which case, the AUD is going just the one direction. And it’s not up.”
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.