RBA to now cut rates by 25bps in October after labor force data - CBA

Dhwani Mehta FXStreet

Commonwealth Bank of Australia (CBA) brought forward its call for a Reserve Bank of Australia (RBA) rate cut to October meeting following disappointing Australian employment data.

Key Quotes:

“Expect RBA to cut the cash rate by 25 bps at Oct meeting after labor force data (the previous call was for November).

Jobs data a 'smoking gun that will force the RBA's hand.

Policymakers desire to see labor market slack recede.

Evidence in data of slack increasing - this trumps the rate of employment growth.

RBA stated 4.5% unemployment is needed to boost wage growth to in turn lift inflation into target band.”

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

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