FXStreet (Bali) – The RBA’s quarterly Statement on Monetary Policy will be released at 1.30 GMT, with the main focus on the growth forecast, notes Sean Callow, FX Strategist at Westpac.
Key Quotes
“The RBA’s quarterly Statement on Monetary Policy will be released at 11:30am Syd/9:30am Sing/HK. Focus will be on the growth forecast.”
“Westpac expects growth in 2016 to be cut from 3.25% to 3.0%. Governor Stevens indicated that the Bank would be reviewing its assumption on trend growth, which until now has generally been assessed as 3-3.25%.”
“At 3.0%, growth would be around current estimates of trend and be consistent with no policy change. Lower trend growth would also mean that the negative output gap between trend and actual growth would be smaller and disinflationary pressures less intense.”
“The 2016 inflation forecast in the May SoMP was centred around 2.25% and we expect the inflation outlook to remain benign. Retention of a 2.25% core inflation forecast for 2016 leaves open the option of easing as needed.”
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