With basically no chance of an interest rate change from the RBA today, much focuse has turned to the statement that comes with the decision, and to particular sentences. These are the sentences in the March accompanying statement that analysts are going to be looking for in today’s release, to try to divine RBA intentions going forward – are they maintaining their current dovish stance or looking to move away from it and perhaps signalling we are closer to the end of the easing cycle?
- “the inflation outlook, as assessed at present, would afford scope to ease policy further, should that be necessary to support demand”
- Will Steven’s repeat “further reductions may be required”?
- “Dwelling investment appears to be slowly increasing, with higher dwelling prices and rental yields”
The prevailing view in the market is that Steven’s may edge towards being a little less dovish than in the past, but there is no expectation of switching to an overt hawkish stance – its still too early.
Earlier post from today regarding the RBA decision: RBA announcement due at 0330GMT
