RBA governor, Philip Lowe, speaks in Sydney
- The board has not yet made a decision, much depends on labour market
- Economic forecasts had assumed rates at 1% by year-end
- Rate decision was not in response to deterioration in outlook since May
- Easing aimed at spurring jobs growth, lifting inflation
- Rate cut is to lead lower AUD than otherwise would have been the case
- One option is for fiscal support, including spending on infrastructure
- Says that banks should fully pass through rate cut through mortgage rates
- Well aware that savers will be disappointed by rate cut
Pretty much just reaffirming the message in what the central bank statement was trying to convene, in that there is no firm commitment to future rate cuts and that they will be data dependent. But also that future rate cuts are not off the table, so that'll keep markets guessing for now.
As mentioned earlier, if their stance is to rely on the data and global economic developments, they're more likely going to get more disappointed so that'll open the path for another cut later on in the year in my view.
AUD/USD sits unchanged at 0.6977 currently, not really doing much on the session. There will be a Q&A session between Lowe and the media later at 0950 GMT so let's see if there will be anything else of note to follow.
