Westpac on AUD & RBA: Further substantial appreciation necessary to trigger a rate cut

Comments from Westpac Chief Economist Bill Evans on the Reserve Bank of Australia policy meeting yesterday

• a further substantial appreciation in the AUD would be necessary to trigger a policy response

Evans also highlights the importance of the upcoming inflation data from the Australia Bureau of Statistics (due April 27) ... the inflation report has replaced "recent financial turbulence" as the important new source of information along with labour market conditions

Evans concludes:

• We are retaining our call that rates will remain on hold for the remainder of the year.
• That is predicated on the Australian dollar remaining broadly in the 70-76c US range.
• ... (the) statement certainly does not identify a trigger level for the AUD to elicit a policy response. We do not envisage a further significant surge in the AUD and remain comfortable with a steady policy outlook.