RBA Minutes: No urgency for the Bank to cut rates - TDS

Research Team at TDS, suggests that the Minutes of the RBA’s June meeting suggest there is no urgency for the Bank to cut rates with stronger growth trumping inflation concerns for now.

Key Quotes

“Not only does the Bank cite low interest rates and the depreciation in the AUD as supporting expansion in the non-mining sectors of the economy, the Bank downplays recent weak wage measures, stating some were slightly more positive.  This last point was not evident in the May minutes.

Overall, today’s minutes do nothing to provide more clarity around an August cut. This remains a 50/50 proposition with Q2 CPI on 27th July really the only data release that matters. The May SoMP had underlying inflation at 1.5%/yr to June, with our preliminary work suggesting CPI coming in at 1.3%/yr. TD maintains its call for an August cut to 1.5%.”