The minutes of the Reserve Bank of Australia August meeting were released yesterday.

Since the meeting we'd had:

  • the quarterly Statement on Monetary Policy (SoMP) from the Bank
  • Governor Lowe's Semi Annual Testimony to parliament (committee)
  • and speeches from Debelle and other senior RBA officials

Al of which rendered the minutes as a bit out of date already. Nevertheless there was a focus on them. Post is here:

AUD traded higher after, the rally stymied ahead of 0.68 and AUD/USD gave a little back overnight.

Checking out some of the responses, in summary (bolding is mine).


  • In these minutes, the emphasis has changed to the following "the Board judged it appropriate to assess developments in the global and domestic economies before considering further change in the setting of monetary policy. Members would consider a further easing of monetary policy if the accumulation of additional evidence suggests this was needed to support sustainable growth in the economy and the achievement of the inflation target over time".
  • So the message here is that policy could be eased in response to an unexpected deterioration in the global economy without the labour market providing an adequate justification for a rate cut.
  • we remain comfortable with our forecast that the RBA will next cut the cash rate in October by 25bps and wait until early 2020 (February) for the second cut of 25bps


  • "Certainly we don't think the domestic data since the August meeting meets the Board's threshold of an "accumulation of additional evidence"

(for another cut yet)

The global news flow has been more negative, but not enough on its own to meet the RBA's threshold in our view. Together this suggests a September rate cut is unlikely."

We think October is in play

  • with some critical data due between the September and October board meetings such as
  • Q2 GDP,
  • business and consumer sentiment readings
  • and labour market data.


  • RBA said the board will consider further easing if evidence suggests it's needed
  • it's reasonable to expect an extended period of low interest rates
  • The RBA also said it sees few signs of wage pressure or near-term CPI pressure