A couple of snippets from previews of the Reserve Bank of Australia policy meeting tomorrow.


  • given the data continues to outpace their forecasts with the unemployment rate already at 4% and set to head sub-4% next month, a greater nod to balancing risks in the post-meeting statement would put guidance on a more agile setting, which we think is needed given Q1 CPI is likely to surprise the RBA (NAB has pencilled in a Q1 trimmed mean print of 1.2% q/q against the RBA’s Feb forecast of 0.8%).

NAB are correct on inflation likely to surprise higher, if today's monthly CPI data is any guide:

Australia, monthly inflation gauge (March): Headline inflation: +0.8% m/m to 4.0% y/y

The trimmed mean in that data was solid also. Down from the February reading but that is pretty much just a base effect. The trimmed mean q/q was 1.4%, much higher than RBA forecasts of 0.7 to 0.8% q/q.


  • Our view is that the RBA will commence a tightening cycle from June 2022 with a 15bp increase in the cash rate target. While we expect the cash rate to remain at 0.1% at the April Board meeting next week, we will be looking for any change in language from the RBA Governor.
  • Specifically, we see clear risk that the RBA Governor removes the line that “the Board is prepared to be patient” from his post-meeting Statement.

This from BNZ earlier:

Reserve Bank of Australia monetary policy meeting this week - "non event"

RBA Phillip Lowe meme hiding