Monday, 08 April, 2019

(BFW) RBC Sees RBA Shifting to Easing Bias in May, Cuts in Aug. & Nov.

RBC Sees RBA Shifting to Easing Bias in May, Cuts in Aug. & Nov.
2019-04-08 04:03:46.158 GMT

By Michael Heath
(Bloomberg) — RBC economists led by Su-Lin Ong say there’s
a risk interest-rate cuts could come sooner, depending on how
the housing market unfolds.
* Activity probably won’t be strong enough to prevent more
significant weakening in the labor market. “A further weakening
in the leading indicators of residential construction, house
prices, household consumption and confidence and continued
subdued business conditions” suggest continued below-trend
activity
* Sees possibility of easing bias being adopted at May 7 policy
meeting and then fleshed out when updated quarterly economic
forecasts are released three days later
* “While the RBA has tolerated sub-target inflation for the last
three years, its persistence amid a weakening domestic demand
and growth outlook is more challenging”

To contact the reporter on this story:
Michael Heath in Sydney at mheath1@bloomberg.net
To contact the editors responsible for this story:
Nasreen Seria at nseria@bloomberg.net
Chris Bourke