The RBA issued a monetary policy statement with a hawkish tinge on Friday, meaning a hike is more likely than a cut any time soon, say ANZ economists.
In part two of our bonus deep-dive interview, ANZ’s Head of Economics for Australia Adam Boyton explains why the NAIRU (Non-Accelerating Inflation Rate of Unemployment) is still falling, despite Covid’s supply shocks.
5 things to know
The RBA published its Statement of Monetary Policy with fresh forecasts suggesting the risks of hikes are higher than for cuts anytime soon, ANZ Senior Economist Adelaide Timbrell says.
ANZ’s view on the RBA cash rate remains unchanged at being on hold at 4.35% for now, but with greater chances of a hike.
Adelaide says a cut is unlikely until very late in 2024.
The S&P 500 closed up 1.6% and the Nasdaq was up 2% by the close on Saturday morning. Brent crude bounced 2% to US$82.24. The US 10 year closed at 4.64%. Gold edged down to 1.4% to US$1,942.70/oz. The A$ begins Asian trade at 63.61 USc and the NZ$ is also weak at 58.90 USc.
ANZ Senior International Economist Tom Kenny says market reaction was muted to Moody’s putting its AAA sovereign credit rating for the United States on review for downgrade.
Cheers
Bernard
PS: Have a great day and look out tomorrow for a preview from Tom Kenny of key US inflation figures due early on Wednesday morning.
