Australian Herald-Sun RBA watcher Terry McCrann writes today that the final Australian economists who was forecasting a rate cut this year backed off after Stevens’ Parliamentary appearance where he downplayed the chance of a cut.
McCrann says some bad news could change that:
If we got further bad news on the jobs front in the next two or three monthly surveys, and the September quarter CPI number was low, suggesting that the highish June number was a one-off, watch that gaggle of economists break and run, back to the other side of the “prediction ship”.
This is most certainly not a prediction that the data will unfold that way; just that while Stevens does not want to cut again, he will if he has to. Especially, it’s worth adding, if housing prices show signs of cracking.
