The firm previously saw cuts in February and May next year
The call stems from the dovish minutes yesterday and offshore developments - easing by other central banks and persistent downside risks to global growth, the firm argues.
Adding that:
"The minutes noted evidence that retailers are yet to benefit from income tax rebates, potentially threatening the bank's forecast of improvement in domestic demand... On wages, the RBA stated that 'the upward trend in wages growth appeared to have stalled'...While the resurgence in some housing indicators of late may be of concern, we think fears of a global recession ultimately carry more weigh in the RBA's reaction function...At a time when a lower exchange rate is a key transmission mechanism for the RBA, a domestic response to lower global interest rates takes on more importance. And from a communications perspective, rate cuts from the ECB, Fed and BOJ provide the RBA with ample cover."
