A note on the Reserve Bank of Australia monetary policy meeting via Capital Economics
- They tip unchanged next Tuesday
- But look for a cut in April, then again in July
Main ppints from CE:
- RBA remains concerned that cutting rates further will undermine financial stability
- But coronavirus outbreak set to dampen activity and unemployment will climb further
On that first point:
- we don't think that the RBA's concerns about financial stability are an insurmountable hurdle
- housing finance commitments have rebounded … consistent with housing credit growth remaining very subdued
On AUD/USD:
- we think it may fall to US$0.65 by the end of the year
