bill evans westpac - summary on the rba's comments on interest rates today
Conclusion As expected there is nothing significant in this statement to motivate us to change our forecast that the next move in rates will be up but not for at least a year. Our official forecast is for a 25bp increase in the cash rate at the Board meeting in August next year. The statement continues to emphasise the significant decline in mining investment; spare capacity in the labour market; moderate economic growth ; a noticeable decline in the growth of wages and an overvalued AUD. All of these factors point to no urgency to raise rates while improving business and consumer confidence; increasing credit growth; rising dwelling prices; and market driven rate cuts also eliminate any need for the Bank to cut the cash rate.
