Response to the RBA - "clearly less comfortable with its previous positive outlook"

Westpac's Chief Economist Bill Evans on the Reserve Bank of Australia today

This in brief from his longer and more detailed report:

• The RBA has lowered their growth forecasts but they remain above that of Westpac. The Governor chose to repeat the statement's concluding paragraph which explains the policy decision with the same words that he used in December despite lower forecasts and recognition of downside risks.

Conclusion

• With these revised forecasts, the RBA is clearly less comfortable with its previous positive outlook. Its growth forecasts remain significantly above Westpac's own view. With our forecasts of 2.6% growth in 2019 and 2020, it still seems that the more likely outcome will be for steady rates, even if as we expect, the RBA will eventually have to adopt growth forecasts much closer to Westpac's current view.
• Westpac confirms its long-held forecast that the RBA cash rate will remain on hold in 2019 and 2020.

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Earlier on the RBA today:

• There is more to come from the RBA (thankfully not until tomorrow, then Friday)
• AUD jumped on the as expected RBA decision (so, was it?)
• Comparing the RBA Gov. Lowe's statement in February with his previous
• RBA announce no change to cash rate, on hold as expected