RBA leaves cash rate unchanged at 4.35% in August monetary policy meeting, as expected

  • Cash rate 4.35%
  • Prior 4.35%
  • While the impact of the Middle East conflict on inflation has so far been less than expected, headline inflation is still too high
  • Short-term measures of inflation expectations have eased but remain higher than earlier in the year
  • There continue to be heightened uncertainties about the outlook for domestic economic activity and inflation
  • A period of prolonged uncertainty may also cause growth to be lower overseas and in Australia
  • Focused on ensuring that high inflation does not become embedded
  • Inflation not expected to return to around the midpoint of the target range until late 2027
  • There are also upside risks to this projection
  • Will continue to do what is necessary to bring inflation back to target, including increasing the cash rate target further if upside risks materialise
  • Decision today was unanimous
  • Full statement

Coming into the decision, traders were pricing in ~97% odds of no change for the meeting. More to come..

This article was written by Justin Low at investinglive.com.

Leave a Reply