The Reserve Bank of Australia cuts hawkishly, warning of uncertainties around the labour market. The question now is whether it will cut again this year. And Australian consumers lost a bit of confidence ahead of the cut.
In our bonus deep dive interview, ANZ New Zealand Chief Economist Sharon Zollner analyses the picture the Reserve Bank of New Zealand faces today as it decides how much to cut rates.
5 things to know in 5 minutes:
The Reserve Bank of Australia yesterday cut its cash rate target by 25 basis points to 4.1% - its first cut since November 2020. It had been at 4.35% since November 2023. ANZ Senior Economist Adelaide Timbrell says the main message in the announcement was its hawkishness.
Adelaide says the RBA emphasised that uncertainty on the strength of the labour market was leading it to be cautious about any more cuts.
ANZ Research continues to forecast that the RBA will cut rates again in August. Adelaide says the key thing to watch now is the labour market data.
Another theme being watched for was how cautious the RBA would be about the volatile global economic environment.
Ahead of the RBA release, ANZ Roy Morgan Consumer Confidence fell 1.6 points last week to 85.1, its lowest this year. However, ANZ Economist Sophia Angala says confidence has been edging up recently following stage 3 tax cuts, and the hope for the RBA cut.
Cheers,
Bernard
PS: Catch you tomorrow morning with coverage of the RBNZ’s rate decision today.
