RBA Door Still Open
By Greg Peel
Perhaps the most surprising element of this month's RBA monetary policy statement is its brevity. Although the considerable majority of economists were not expecting the central bank to cut its cash rate after cutting in May to 2.75%, the market has been waiting with baited breath to read just what the RBA's thoughts were on the big drop in the Aussie and talk of a Fed exit from QE.
The reason why the statement was so brief is because there was a suggestion that very little had changed since the May statement, and data releases over the month have done no more than support the view held by the board a month ago. "The outlook published by the bank last month is for a similar performance in the near term," notes RBA governor Glenn Stevens, "and recent data are consistent with this".