A couple of previews of the Reserve Bank of Australia meeting for Sep 2019

Spoiler is on hold is expected.


  • We expect the RBA to hold the official cash rate steady at 1%. The central bank remains ready to cut rates again "if needed". We expect rate cuts in November 2019 and February 2020.


  • The Reserve Bank of Australia is not expected to alter its cash rate target
  • Twenty-six out of 31 forecasters expect a hold
  • OIS markets are pricing only about one-in-seven odds of a cut
  • The status of labour markets has been a key consideration to the RBA, so the 41,000 jobs that were created in July that kept the unemployment rate stable at 5.2% was probably encouraging especially since it rebounded from the only weak month for jobs gains so far this year. Governor Lowe's recent remarks that "political shocks are turning into economic shocks" but that "Monetary policy cannot deliver medium-term growth. We risk just pushing up asset prices" wasn't the sort of language that marks a central banker intent on rushing forward with additional easing. Thus, even though trade tensions have escalated over the past month, it's not clear the RBA is ready to further deploy its toolkit.