Reserve Bank of Australia Governor Lowe in the Q&A following his earlier speech
- CPI data in like with our expectations
- Bank liason suggests current slow rate of wages growth to remain for a while
- Would not want to see labour share of national income decline any further
- Average wage growth of 2% will struggle to generate CPI at 2.5pct
- Higher power prices are hurting business and investment
- Increase in electricity prices will have a significant effect on CPI, will take that into account
- Weak wage expectations are dragging on consumption
- Says very comfortable with current setting of policy
- Says it would be better if the AUD were a bit lower than it is
'Would be better if the AUD was a bit lower'.
Jawboning. Doing it wrong. Sheesh dude ....
More:
- Expects cash rate in the future to be lower than in the past
- Says neutral rate around 3.5% but a lot uncertainty about that
- Some people got overly excited about discussion of neutral rate at last meeting
He is still going ...
- More:
- Looks like some of the heat coming out of the Sydney and Melbourne housing markets
- Lot of new housing supply coming, rent growth is weak, less foreign demand
- Rise in some mortgage rates should help slow housing markets