Here’s what economists from some of Australia’s largest financial institutions are expecting to hear from the RBA this afternoon.
Taylor Nugent (NAB senior economist):
“The RBA is expected to remain on hold with little change to the post meeting statement or the guidance from Governor Bullock in the post meeting press-conference, where the recent mantra has been “not ruling anything in or out.
“There are no new forecasts at this meeting and the recent run of data has been broadly in line with May forecasts.
“The RBA has the luxury of waiting until the full Q2 CPI [second quarter consumer price index] on 31 July before their next forecast update at the August meeting.”
Ben Jarman (JP Morgan chief economist):
“The guidance that the board “is not ruling anything in or out” is likely to remain, as is the statement that it will be “some time yet” before inflation is sustainably back at the target.
“The more dovish remarks will likely relate to offshore matters, particularly ongoing weakness in China and geopolitical risks, though we expect the global theme of sticky services inflation will be mentioned again as a cautionary tale.”
Diana Moussina (AMP deputy chief economist):
“The cash rate is expected to be held at 4.35% (with all economists looking for no change to interest rates) but more importantly will be the commentary in the post-meeting statement and press conference.
“The economic data since the last meeting in May has mostly been in line with the RBA’s expectations.
“The 2024-25 Federal Budget and state budgets released so far have been probably had more spending then the RBA would have liked to see but the Fair Work Commission decision around minimum wages was a tad lower than expected.
“So all up, there is no reason for the RBA to changes its assessment that the current stance of monetary policy is appropriate but that they cant rule anything “in or out” in terms of interest rates.
“The board will probably debate the merits of a rate hike at the meeting but this is not a sign that the RBA is willing or ready to raise interest rates again.
“We continue to expect the next move to be a rate cut around the end of the year.”