RBA monetary policy meeting preview and where to for the AUD (scenarios)
This now in brief via TD:
- RBA Deputy Governor Debelle reaffirmed Governor Lowe's earlier views - no cash rate cut is expected and negative rates are off the table.
- That said the RBA will maintain ample liquidity. keeping the cash rate well below the target rate for some time.
While the RBA is cautiously optimistic on the outlook. the focus is shifting towards the Bank pushing for more fiscal stimulus when initiatives roll off over Sep/Oct.
On the AUD:
- The RBA may not provide the AUD with much direction as it continues to track equities. AUDUSD has rebounded fully from its crisis lows. but the RBA may be hard-pressed to make a strong case the AUD is too rich,