The RBA decision is at 0430 GMT
The Reserve Bank of Australia is wholly expected to cut rates later, bringing the cash target to 1.25% from 1.50%.
Of the 38 economists in they survey, all but two expect a rate cut with Credit Suisse and a Thai bank as the lone holdouts. The OIS market is even more unanimous with a 99.1% chance of a cut priced in.
Beyond this meeting and towards signals about the future is where it gets interesting. A second cut in July is 40% in and a third cut before year-end is at about 43%.
TD Securities looks at a number of different scenarios. They say some kind of neutral cut is a 70% probability but that there is a 10% of a dovish cut, with a statement something like this that highlights uncertainty abroad:
"At today's meeting, the Board judged that, with modest domestic growth and a weaker and more uncertain international environment, the outlook for inflation afforded scope for a more accommodative stance of monetary policy."
They say that would cut about 0.5% from the Australian dollar. Alternatively, it would rise by the same margin if the statement hinted at a 'wait-and-see' option.
Looking further out, the GDP report on June 5 and jobs report on June 13 will be key.
