- We will take things meeting by meeting
- Forecasts imply that cash rate might need to be lower for price stability
- Don't put a lot of emphasis on the neutral rate
- Neutral rate is a long run concept but only in the absence of shocks
- Our forecasts are dependent on more rate cuts
- Would not rule out back-to-back rate cuts
- We will take into account data at each meeting and assess them at said particular meeting
The aussie is marginally lower on the day but nothing that really stands out. The RBA has played things out according to expectations and the language on waiting on more data is still the key part of the guidance. The next key risk event will be the Australian labour market report coming up this Thursday. As things stand, traders are pricing in just ~34% odds of a rate cut for September now.
