RBA meeting Tuesday November 6, preview
Monetary policy decision announcement due at 0330GMT
- and will be accompanied by a statement from Governor Lowe, as always
- there is never a press conference following in case you are wondering
Earlier preview here
A couple more now, these via …
Nomura (added bonus preview of the SoMP coming up Friday):
- We expect the RBA to again announce an unchanged cash rate and anticipate that its press release will contain mixed comments. It is, however, likely to repeat that it expects to achieve its growth and inflation objectives over time, based on current policy settings.
- The press release may provide clues to any forecast revisions in the Quarterly Statement on Monetary Policy (SOMP) released on Friday 9 November. Here, we expect to see an unchanged growth profile, with GDP growth still "a bit above 3%"; a slightly lower unemployment rate forecast and a largely unchanged inflation profile. We retain a low-conviction call for a 25bp rate hike in August 2019, but note that this will require some evidence of stronger inflation pressures in the interim.
- Another steady verdict is universally anticipated on Melbourne Cup Day and we expect the key concluding paragraph to remain unchanged, signalling little shift in thinking or bias. Key global developments since the board last met (weaker equities, mixed activity and ongoing trade tensions) hint at a cautious tone on the international front but the domestic picture is more mixed. A stronger labour market is likely to give the RBA confidence that slack is being absorbed and despite the weaker Q3 inflation print this supports their long held base case for an ongoing decline in the unemployment rate and eventual lift in inflation.
- This will be captured by limited changes to their key macro forecasts. We think, however, there is some risk of a downward revision to its unemployment rate forecasts in the quarterly Statement which would give it a hawkish tinge.