- Communication has been going pretty well
- Different people can have different interpretations of data
- Our interpretation of inflation data was a bit different to the market
- By the next meeting, we will have more data and news developments
- Monthly inflation data is a bit too volatile
- The quarterly CPI report is the more comprehensive read, could be higher
- Looking for confirmation that we’re still on the right path with inflation
- There was a good active debate among policymakers
- The difference in vote was very little, more towards the downside risks from international concerns
- The difference in vote is not about direction, more so about timing
The comments highlighted in bold reaffirms that the decision today doesn’t necessarily mean an extended pause. All eyes will now be on the quarterly CPI report on 30 July to confirm the odds for a rate cut in August. Essentially, this feels like the RBA choosing to play it safe this time around. AUD/USD is now back down to 0.6526 from around 0.6540 earlier.
This article was written by Justin Low at www.forexlive.com.