Reserve Bank of Australia leaves the cash rate unchanged at 4.35%, as expected

Reserve Bank of Australia (RBA)

Headlines via Reuters:

  • Whether further tightening of monetary policy is required to ensure
    that inflation returns to target in a reasonable timeframe will
    depend upon the data and the evolving assessment of risks
  • Board remains
    resolute in its determination to return inflation to target
  • The limited
    information received on the domestic economy since the November
    meeting has been broadly in line with expectations
  • Outlook for
    household consumption also remains uncertain
  • The monthly CPI
    indicator for October suggested that inflation is continuing to
    moderate, driven by the goods sector; the inflation update did not,
    however, provide much more information on services inflation.
  • Measures of
    inflation expectations remain consistent with the inflation target
  • Conditions in the
    labour market also continued to ease gradually, although they remain
  • Domestically, there
    are uncertainties regarding the lags in the effect of monetary
  • Higher interest
    rates are working to establish a more sustainable balance between
    aggregate supply and demand in the economy.
  • Holding the cash
    rate steady at this meeting will allow time to assess the impact of
    the increases in interest rates on demand, inflation and the labour

Bolding is mine. The statement explicitly nodding to data-dependence.

This is a reasonably neutral sort of statement from the Governor, even leaning a little dovish. Bullock has been more aggressively hawkish in her public comments leading up to this meeting. A dissonant statement this.

Full text:

The next official quarterly inflation data is due on January 31 2024, with the next RBA meeting following closely behind on February 5 and 6.

This article was written by Eamonn Sheridan at Source