RBA March minutes show the Bank did not consider the case for an interest rate rise

Reserve Bank of Australia

Headlines via Reuters

  • No mention in minutes that board considered option to raise rates
  • Board agreed it was
    difficult to either rule in or out future changes in cash rate
  • Economic outlook
    uncertain but risks seemed broadly balanced
  • Would take “some
    time” before board could be confident inflation returning to
  • Upside risks to
    inflation had not yet materialised, while consumption was very weak
  • Inflation high but
    gradually returning toward target, labour market easing
  • Gap between demand
    and supply in economy “closing relatively quickly”
  • Board judged demand
    would continue to exceed supply for a time
  • Labour market a
    little tighter than consistent with inflation at target
  • Wage growth may have
    peaked, but not expected to decline quickly
  • Recovery in
    productivity needed to balance high unit labour costs
  • Overall financial
    conditions remained restrictive, particularly for households

Full text is here:

The minutes confirm the shift to less hawkish at the Bank that was evident on the day of the meeting. The March meeting left the cash rate unchanged:

And, from Governor Bullock’s news conference on the day:

This article was written by Eamonn Sheridan at www.forexlive.com. Source