RBA Quarterly Statement Coming Up - ANZ
Analysts at ANZ noted that the RBA’s quarterly Statement on Monetary Policy is released today.
"After the rate cut earlier this week it will be a key focus for markets. Much of that focus is likely to be on the inflation forecasts, where we expect to see a significant downgrade after the surprising weakness in the Q1 inflation numbers.
Underlying inflation is likely to be forecast below the 2-3% target band for the rest of the year, possibly coming in as low as 1¾% in December 2016, which would be a substantial 75bps below the Bank’s previous forecast.
Changes to the growth forecasts are likely to be mixed. The near term numbers are likely to be revised a little higher – reflecting the strength and upward revisions in the Q4 National Accounts. But there is a chance that the further out numbers could be revised slightly lower given the higher exchange rate and the RBA’s concerns about global growth.
There are not likely to be material changes to the unemployment rate trajectory, but the discussion on uncertainties around the outlook is likely to continue to have a substantial focus on China.