TD Securities analysts note that the RBA left its cash rate unchanged at 0.75% in line with theirs and market expectations, noting that they prepared to ease further if needed.
“The statement was a little more constructive than in the November meeting, with RBA noting that the risks to the global economy have lessened recently, while expectations of global easing have been scaled back and financial market sentiment has improved.”
“RBA repeated that Australia's economy has reached a gentle turning point, but uncertainty remains on the outlook for consumption. Once again they note that a lift in wages would be welcome and help push inflation into a 2-3% range. Lower rates may be needed to achieve this in our view.”
“RBA noted the turnaround in established housing markets but that housing credit remains low. RBA highlights the "long and variable" lags in monetary transmission, again suggesting that they want to assess the impact of previous cuts before moving again. There is little here to change the view that the next move is down and a Feb cut still appears likely, but for now RBA is in wait and see mode.”
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.