Major bank calls out RBA over rate cut
Ahead of next week's monetary policy board meeting, Westpac chief economist and former RBA employee Luci Ellis has called out the central bank, questioning: 'What do they expect to learn in the next five weeks? (if they don't cut)'
'Could you front a media conference and explain why you decided to wait another five weeks to cut rates, when it was just a choice between now and August? … the answer is likely to be 'no', she said.
'The arguments to wait are not compelling, so we do not think that case should win the day.' The RBA is tipped to cut rates in July thanks to weaker than expected CPI data. NewsWire / Nicholas Eagar Credit: NewsWire
The RBA is set to meet on Monday and Tuesday next week, and is expected to reduce the official cash rate by a further 25 basis points, bringing the official cash rate down to 3.60 per cent.
Ms Ellis said the arguments against a hold, including waiting for quarterly economic data won't hold up.
'Nothing the RBA will learn in the subsequent five weeks will change the decision to cut,' she said.
'And explaining to the assembled mainstream media that you hesitated because (in essence) unemployment is 'too low' and employment growth is 'too strong' to do so will not land well with that audience.'
Mortgage holders received a major boost last week with inflation coming in significantly lower than forecast, opening the door for a July rate cut. Ms Ellis says it will be hard for the RBA to justify why they held rates. NewsWire Monique Harmer Credit: News Corp Australia
The latest consumer price index rose by 2.1 per cent for the 12 months to May 2025, beating expectations of 2.3 per cent.
The all-important trimmed mean inflation rate, which the Reserve Bank considers when making decisions about the cash rate, came in at 2.4 per cent.
This is the lowest level since November 2021.
Falling inflation data was offset by stronger than expected employment figures which held at 4.1 per cent.
While the RBA runs a dual mandate of both price stability and full employment, too many Australians in a job can be seen as having a negative impact on inflation, as more people can buy a limited amount of items, driving prices higher.
Ms Ellis said a large swing in monthly data, like Australia saw in May can 'tell you enough about quarterly results' even if there is a future upsize surprise.
'Key components of domestic inflation – rents, home-building, insurance and personal services – all surprised on the downside, she said.
'Some of these components are still only measured quarterly and so are locked in for the June quarter read.
'Likewise, another monthly labour force release and the last-ever retail sales number will not change the current view on the economy.
'More information is usually better, but not always by enough to be worth waiting for.'
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
The Advertiser
an hour ago
- The Advertiser
'Cruel' Trump move to shake Aussies' trust in US
Increasingly US-sceptic Australians might further question their nation's ties to the superpower as the impacts of Donald Trump's signature bill sweep through vulnerable communities. The US president's One Big Beautiful Bill Act cleared Congress on Friday, Australian time, enshrining significant cuts to health programs while funding income tax breaks and adding trillions of dollars to debt. America's wealthiest will benefit most from the bill while almost 12 million low-income Americans would be left uninsured, according to the Congressional Budget Office, and many could see their pay drop due to safety-net cuts. While the bill did not directly impact Australians, it would affect their perceptions of the US, according to Cory Alpert, an ex-staffer to former president Joe Biden. "This bill is going to hurt a lot of marginalised people," the Melbourne University researcher told AAP. "Australians are going to look at this and see the cruelty in it, and I think it's going to further drive this conversation about how close Australia is to the United States. "Where do Australians belong in the global conversation: as a floating aircraft carrier in the south Pacific, or as a more independent nation? How aligned do you want to be with Trump's America?" While Australia has positioned itself as a key US ally, cracks have also begun to show in the relationship. When asked recently if the US remained a reliable partner under Mr Trump's leadership, Foreign Minister Penny Wong said Australia understood he had a "different view of how America is to be in the world". Australians' trust in the United States has already dropped by 20 points since 2024, hitting a new low with just 36 per cent of the public expressing any level of trust according to an April poll published by the Lowy Institute. In a speech to be delivered on Saturday, Prime Minister Anthony Albanese will reassert Australia's independence in foreign policy while dismissing Trump-style isolationist policies. "Choosing our own way doesn't mean going it alone," he will tell an audience in Sydney to mark the 80th anniversary of the death of former Labor prime minister John Curtin. "Australia did not just join the institutions which created the international rules based order, we helped shape them." The prime minister will draw comparisons between himself and the ex-wartime leader, saying Curtin did not just look to the US but spoke for Australia. The government has already rebuffed calls from Washington to dramatically increase its defence spending by tens of billions of dollars a year. Many analysts believe the Labor government's landslide election win in May was at least partly fuelled by voters' growing discomfort with the US president at a time when some of the coalition's talking points echoed Mr Trump's platforms. "(Australians) don't want to live in a country that espouses those same types of cruelties," Mr Alpert said. The size of Mr Albanese's victory meant he did not face significant pressure to shift his position towards the US president. But Mr Alpert said he would not be surprised if the government publicly supports some aspects of Mr Trump's latest measures, especially as it tries to negotiate an exemption from US tariffs. "We've already seen examples of that in Australia where leaders are trying to come up with positions where they can go to Trump and say, 'look, we're supporting your position, you should give us a better deal'," he said, pointing to Labor's decision to support US strikes on Iran. "That is probably the more dangerous aspect." Increasingly US-sceptic Australians might further question their nation's ties to the superpower as the impacts of Donald Trump's signature bill sweep through vulnerable communities. The US president's One Big Beautiful Bill Act cleared Congress on Friday, Australian time, enshrining significant cuts to health programs while funding income tax breaks and adding trillions of dollars to debt. America's wealthiest will benefit most from the bill while almost 12 million low-income Americans would be left uninsured, according to the Congressional Budget Office, and many could see their pay drop due to safety-net cuts. While the bill did not directly impact Australians, it would affect their perceptions of the US, according to Cory Alpert, an ex-staffer to former president Joe Biden. "This bill is going to hurt a lot of marginalised people," the Melbourne University researcher told AAP. "Australians are going to look at this and see the cruelty in it, and I think it's going to further drive this conversation about how close Australia is to the United States. "Where do Australians belong in the global conversation: as a floating aircraft carrier in the south Pacific, or as a more independent nation? How aligned do you want to be with Trump's America?" While Australia has positioned itself as a key US ally, cracks have also begun to show in the relationship. When asked recently if the US remained a reliable partner under Mr Trump's leadership, Foreign Minister Penny Wong said Australia understood he had a "different view of how America is to be in the world". Australians' trust in the United States has already dropped by 20 points since 2024, hitting a new low with just 36 per cent of the public expressing any level of trust according to an April poll published by the Lowy Institute. In a speech to be delivered on Saturday, Prime Minister Anthony Albanese will reassert Australia's independence in foreign policy while dismissing Trump-style isolationist policies. "Choosing our own way doesn't mean going it alone," he will tell an audience in Sydney to mark the 80th anniversary of the death of former Labor prime minister John Curtin. "Australia did not just join the institutions which created the international rules based order, we helped shape them." The prime minister will draw comparisons between himself and the ex-wartime leader, saying Curtin did not just look to the US but spoke for Australia. The government has already rebuffed calls from Washington to dramatically increase its defence spending by tens of billions of dollars a year. Many analysts believe the Labor government's landslide election win in May was at least partly fuelled by voters' growing discomfort with the US president at a time when some of the coalition's talking points echoed Mr Trump's platforms. "(Australians) don't want to live in a country that espouses those same types of cruelties," Mr Alpert said. The size of Mr Albanese's victory meant he did not face significant pressure to shift his position towards the US president. But Mr Alpert said he would not be surprised if the government publicly supports some aspects of Mr Trump's latest measures, especially as it tries to negotiate an exemption from US tariffs. "We've already seen examples of that in Australia where leaders are trying to come up with positions where they can go to Trump and say, 'look, we're supporting your position, you should give us a better deal'," he said, pointing to Labor's decision to support US strikes on Iran. "That is probably the more dangerous aspect." Increasingly US-sceptic Australians might further question their nation's ties to the superpower as the impacts of Donald Trump's signature bill sweep through vulnerable communities. The US president's One Big Beautiful Bill Act cleared Congress on Friday, Australian time, enshrining significant cuts to health programs while funding income tax breaks and adding trillions of dollars to debt. America's wealthiest will benefit most from the bill while almost 12 million low-income Americans would be left uninsured, according to the Congressional Budget Office, and many could see their pay drop due to safety-net cuts. While the bill did not directly impact Australians, it would affect their perceptions of the US, according to Cory Alpert, an ex-staffer to former president Joe Biden. "This bill is going to hurt a lot of marginalised people," the Melbourne University researcher told AAP. "Australians are going to look at this and see the cruelty in it, and I think it's going to further drive this conversation about how close Australia is to the United States. "Where do Australians belong in the global conversation: as a floating aircraft carrier in the south Pacific, or as a more independent nation? How aligned do you want to be with Trump's America?" While Australia has positioned itself as a key US ally, cracks have also begun to show in the relationship. When asked recently if the US remained a reliable partner under Mr Trump's leadership, Foreign Minister Penny Wong said Australia understood he had a "different view of how America is to be in the world". Australians' trust in the United States has already dropped by 20 points since 2024, hitting a new low with just 36 per cent of the public expressing any level of trust according to an April poll published by the Lowy Institute. In a speech to be delivered on Saturday, Prime Minister Anthony Albanese will reassert Australia's independence in foreign policy while dismissing Trump-style isolationist policies. "Choosing our own way doesn't mean going it alone," he will tell an audience in Sydney to mark the 80th anniversary of the death of former Labor prime minister John Curtin. "Australia did not just join the institutions which created the international rules based order, we helped shape them." The prime minister will draw comparisons between himself and the ex-wartime leader, saying Curtin did not just look to the US but spoke for Australia. The government has already rebuffed calls from Washington to dramatically increase its defence spending by tens of billions of dollars a year. Many analysts believe the Labor government's landslide election win in May was at least partly fuelled by voters' growing discomfort with the US president at a time when some of the coalition's talking points echoed Mr Trump's platforms. "(Australians) don't want to live in a country that espouses those same types of cruelties," Mr Alpert said. The size of Mr Albanese's victory meant he did not face significant pressure to shift his position towards the US president. But Mr Alpert said he would not be surprised if the government publicly supports some aspects of Mr Trump's latest measures, especially as it tries to negotiate an exemption from US tariffs. "We've already seen examples of that in Australia where leaders are trying to come up with positions where they can go to Trump and say, 'look, we're supporting your position, you should give us a better deal'," he said, pointing to Labor's decision to support US strikes on Iran. "That is probably the more dangerous aspect." Increasingly US-sceptic Australians might further question their nation's ties to the superpower as the impacts of Donald Trump's signature bill sweep through vulnerable communities. The US president's One Big Beautiful Bill Act cleared Congress on Friday, Australian time, enshrining significant cuts to health programs while funding income tax breaks and adding trillions of dollars to debt. America's wealthiest will benefit most from the bill while almost 12 million low-income Americans would be left uninsured, according to the Congressional Budget Office, and many could see their pay drop due to safety-net cuts. While the bill did not directly impact Australians, it would affect their perceptions of the US, according to Cory Alpert, an ex-staffer to former president Joe Biden. "This bill is going to hurt a lot of marginalised people," the Melbourne University researcher told AAP. "Australians are going to look at this and see the cruelty in it, and I think it's going to further drive this conversation about how close Australia is to the United States. "Where do Australians belong in the global conversation: as a floating aircraft carrier in the south Pacific, or as a more independent nation? How aligned do you want to be with Trump's America?" While Australia has positioned itself as a key US ally, cracks have also begun to show in the relationship. When asked recently if the US remained a reliable partner under Mr Trump's leadership, Foreign Minister Penny Wong said Australia understood he had a "different view of how America is to be in the world". Australians' trust in the United States has already dropped by 20 points since 2024, hitting a new low with just 36 per cent of the public expressing any level of trust according to an April poll published by the Lowy Institute. In a speech to be delivered on Saturday, Prime Minister Anthony Albanese will reassert Australia's independence in foreign policy while dismissing Trump-style isolationist policies. "Choosing our own way doesn't mean going it alone," he will tell an audience in Sydney to mark the 80th anniversary of the death of former Labor prime minister John Curtin. "Australia did not just join the institutions which created the international rules based order, we helped shape them." The prime minister will draw comparisons between himself and the ex-wartime leader, saying Curtin did not just look to the US but spoke for Australia. The government has already rebuffed calls from Washington to dramatically increase its defence spending by tens of billions of dollars a year. Many analysts believe the Labor government's landslide election win in May was at least partly fuelled by voters' growing discomfort with the US president at a time when some of the coalition's talking points echoed Mr Trump's platforms. "(Australians) don't want to live in a country that espouses those same types of cruelties," Mr Alpert said. The size of Mr Albanese's victory meant he did not face significant pressure to shift his position towards the US president. But Mr Alpert said he would not be surprised if the government publicly supports some aspects of Mr Trump's latest measures, especially as it tries to negotiate an exemption from US tariffs. "We've already seen examples of that in Australia where leaders are trying to come up with positions where they can go to Trump and say, 'look, we're supporting your position, you should give us a better deal'," he said, pointing to Labor's decision to support US strikes on Iran. "That is probably the more dangerous aspect."
Sky News AU
8 hours ago
- Sky News AU
‘She's hopeless': Pauline Hanson says eSafety Commissioner should be sacked following loss of landmark censorship case
One Nation Leader Pauline Hanson says eSafety Commissioner Julie Inman Grant should be 'thrown out of the job' following the Commissioner's recent track record, including losing a landmark case to a prominent Canadian activist. Chris Elston, known online as 'Billboard Chris', and Elon Musk's X prevailed in a major case against the eSafety Commission and transgender activist Teddy Cook on Tuesday following a ruling by the Administrative Review Tribunal. The ruling rescinded a takedown order issued by the eSafety Commissioner over a social media post by Mr Elston from February last year. In the post, the activist slammed a move to appoint Cook to a World Health Organisation panel drafting policy on caring for transgender people. Ms Inman Grant has also come under fire for advising Communications Minister Anika Wells to include YouTube in a social media ban for under 16s – which is set to come into effect from December 10. Ms Hanson has called out Ms Inman Grant in the wake of the Administrative Review Tribunal case ruling, claiming the commissioner is 'incompetent' and 'shouldn't be in the job at all'. 'By looks of it, she's a person pushing her own ideology, her own agenda, and she gets it wrong every time. She doesn't get it right, and it's been overturned that many times," Ms Hanson said told Sky News host Rowan Dean on Friday. The Queensland Senator also slammed Ms Inman Grant for seeking to have YouTube included in the social media ban, a move which Ms Hanson said she opposed. 'A lot of kids get some good information from YouTube. So I think that it's just gone too far, I think she's out of her depth, I don't think she knows what the hell she's doing.' She commended Mr Elston for winning the case against the Commission. 'I wish she'd ... be thrown out of the job. She's hopeless, useless,' Ms Hanson said. revealed on Thursday that about $66,000 of Australians' taxpayer dollars were spent on the eSafety Commission's legal costs to date in its defeat to Mr Elston and X Corp. 'eSafety notes the Administrative Review Tribunal's decision to set aside eSafety's decision to give a removal notice to X Corp relating to a post on X by Mr Elston," an eSafety spokesperson told 'This is the first case before the Tribunal seeking review of a decision where eSafety assessed the material met the criteria for adult cyber abuse.'
West Australian
9 hours ago
- West Australian
Herd on the Terrace: Roger Cook might be walking on a nightmare with 'Made in WA' pledge
The Bull has been pondering whether Roger Cook is walking into a nightmare thanks to his government's obsession with making stuff in WA. Cook was out of the frying pan and into the fire this week after revelations the next Tourism WA advertising campaign will be partly produced on the east coast. Procuring elaborate visuals of flying whale sharks from elsewhere would ordinarily not be especially unusual, given Western Australia has three million people and a reasonably small film industry. But the government has walked (on a dream) into a locally-built mess given 'Made in WA' was their flagship pledge in a thumping March State Election victory. When mission-critical manufacturing jobs including buses, power line towers and batteries must be assembled in the State — at great expense — artists would be fair enough to ask why there are no such requirements for creative work. Then where does it end? Stand down, BHP's fly-in, fly-out work force, Rita Saffioti wants you in Neerabup slapping together over-priced refrigerators. Petroleum engineer? Not any more! Off to Bellevue to join local procurement champions Alstom. The French company will bank $1.4 billion to make the new Metronet C-Series rail cars in India, ship them to Perth, and add a few highly uncomfortable seats in a warehouse. Hope you know how to hold a welding torch! The new trains are a true tribute to globalisation, although the local union movement would never admit that. When 'Made in WA' is your biggest promise, it becomes the metric by which every decision will be judged. We may have a shortage of workers in WA but there's never a deficit of political over-commitment. Just when you thought the so-called national carrier was cleared for reputational take-off, cyber criminals have aimed their keyboards at Qantas. Close to six million Australians were in fear that their frequent flyer points had been siphoned off to Nigeria this week when the Flying Kangaroo revealed a major data breach. Thankfully, the government-protected airline promised customers 'no frequent flyer accounts were compromised', just personal identity details. All good then! Why bother stealing all those hard-earned points anyway, given they would probably expire before arrival. The hackers are as yet unknown but The Bull expects they will soon release the membership list of Qantas' infamous Chairman's Lounge as proof of life. When director Todd Sampson — who parachutes off the board at the end of the month — hosted the 2016-2020 TV show Body Hack, we can only assume Qantas did not intend the title to be taken literally. We hope Todd can imitate Liam Neeson and personally track down Australia's Taken passport details. Recent openings in two of WA's top lobbying jobs will mean anyone who's ever been in a photo with the Artful Roger will want to put their hands up for the prized positions. Plenty of eyes are on Association of Mining and Exploration Companies boss Warren Pearce as a top option to replace Chamber of Minerals and Energy chief Rebecca Tomkinson when she jets off to a lucrative London trade gig. Also hunting for new hires will be the Chamber of Commerce and Industry WA, thanks to the swift departure of fly-in, fly-out boss Peter Cock after just four months. A tenacious orator, Pearce made a name for himself for scoring tax production credits (or taxpayer handouts, depending on your persuasion) for the State's critical minerals battlers, and is regarded as a tactful treader between business and government. The CME job requires ensuring powerful members — such as Rio Tinto and BHP — have their needs heard loud and clear at the cabinet table. And we wouldn't want these multibillion-dollar multinationals left without a voice. Alas, word is the lobbyist has actually started to turn a shade of cerulean denying his interest in the role, and is dead set on staying put . . . really.
