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RBA Today

Published September 3, 2019

Author: Rowan Murphy

With US markets out of action for their Labor Day holiday, it was always going to be a relatively quiet start to the week, I wasn’t expecting it to be as quiet as it was though with the AUD/USD sticking within a ~20 point range. The RBA announce their interest rate decision today, so the last 24 hour’s price action could potentially have been ‘the calm before the storm’.

The RBA is obviously scheduled to meet today and, if market pricing is any guide, they are widely expected to keep interest rates on hold (1.00%). As a result, the chances are that today’s RBA meeting will one of those focused primarily on the commentary and guidance delivered by the central bank. Really, it’s going to be all about getting a gauge on the current risks to the economic outlook. Afterall, the global “uncertainties” alluded to by the RBA during its last meeting have only gotten worse.

The RBA has a chance to get a ‘second’ mover advantage (NZ cut by 50 points last month) in pulling our interest rates aggressively lower, but I’m not convinced they want to lead the pack here at the moment, seeming to prefer/maintain as much of a ‘laissez faire’ style arrangement for as long as they can.

Adding to the world’s current economic melancholy is expected to be the ABS who are releasing quarterly GDP figures tomorrow. The print is widely expected to show the weakest annualised rate of growth for the local economy for over 8 years (forecast to print at 1.4%). This amongst a whole heap of data to be released this week.

Watch this space.