Home›Forex›Central Banks›RBA holds rates, lifts unemployment outlook and keeps…

RBA holds rates, lifts unemployment outlook and keeps AUD under pressure

Commerzbank said the RBA decision was unanimous and the updated forecasts point to higher unemployment and lower short term inflation, keeping the next move skewed toward a rate cut.

Reported · Written up by our desk · Central Banks

The Reserve Bank of Australia left interest rates unchanged in a unanimous decision, but new central bank forecasts signal weaker labor market conditions and softer short term inflation, according to analysis cited by FXStreet.

Commerzbank’s Volkmar Baur said some market participants expected a dissenting vote for a rate hike, but that did not materialize, and the RBA statement was not viewed as particularly hawkish.

The updated outlook revised the expected unemployment rate upward and short term inflation forecasts downward, with medium term inflation risks still leaving room for further hikes.

Still, Baur argued that the next likely step is a rate cut, a setup that suggests the Australian dollar could remain under pressure over the coming months.

More like this

Sources