Latest news with #Reserve Bank of Australia
Wall Street Journal
22-07-2025
- Business
- Wall Street Journal
RBA Board Awaits Inflation Update Before Moving to Cut Rates
SYDNEY—The Reserve Bank of Australia's monetary policy board kept interest rates on hold earlier this month, deciding that a more gradual pace of cuts was needed, and that there was time to wait for the release of crucial second-quarter inflation data. 'They believed that lowering the cash rate a third time within the space of four meetings would be unlikely to be consistent with the strategy of easing monetary policy in a cautious and gradual manner to achieve the board's inflation and full employment objectives,' minutes of the July 7-8 policy meeting said.
Yahoo
22-07-2025
- Business
- Yahoo
Australia central bank wary of cutting rates too quickly, prudent to await more data
SYDNEY, July 22 (Reuters) - Australia's central bank judged lowering interest rates for a third time within four meetings was not consistent with its strategy of easing in a cautious and gradual manner, a reason that it shocked markets by holding steady this month. Minutes of its July 7-8 policy meeting showed the majority of the Reserve Bank of Australia's nine-member board judged rates at 3.85% were still modestly restrictive, but it was difficult to know how far they could be cut before becoming neutral. "So members observed that it might be prudent to lower interest rates cautiously as the required degree of policy restrictiveness declines," the minutes showed. The three members that argued for a rate cut judged there was already sufficient evidence that inflation was on track to be sustainably back to target, and there was less need to wait before eaing policy further. The RBA surprised markets by holding interest rates steady at the meeting in a rare split of six to three, saying the majority of the board wanted to wait for more information including quarterly price data to confirm inflation was slowing. Traders had wagered heavily on a cut after a monthly inflation report had shown the closely-watched trimmed mean measure hitting a 3-1/2 year low of 2.4% in May. The economy also barely grew in the first quarter as public demand sputtered. In a nod to market pricing, the RBA said there had been instances in the past where markets had been very confident about the outcome of a policy meeting, but the central bank had acted a different other way. The RBA said several data indicators had been in line with or even slightly stronger than forecasts, pointing to the benefit of waiting for a little longer. It noted that even though economic growth was muted in the first quarter, a pick up in private demand was stronger than expected and the labour market had not eased as expected. It noted monthly inflation could be volatile, and components like housing suggest June quarter inflation could be slightly stronger than expected. On top of those reasons, the probability of the gloabl economy evolving in line with the most severe downside secario had declined, although the future state of U.S. trade and other policies was unpredictable. Markets now imply around a 91% chance the RBA will ease again at its next meeting on August 12, after a surprisingly soft jobs report raised concerns that the resilient labour market was finally showing some cracks. Futures see rates bottoming around 3.10% by early next year. (( +61 0 427901124;)) Keywords: AUSTRALIA RBA/MINUTES Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
22-07-2025
- Business
- Yahoo
Australia central bank wary of cutting rates too quickly, prudent to await more data
SYDNEY, July 22 (Reuters) - Australia's central bank judged lowering interest rates for a third time within four meetings was not consistent with its strategy of easing in a cautious and gradual manner, a reason that it shocked markets by holding steady this month. Minutes of its July 7-8 policy meeting showed the majority of the Reserve Bank of Australia's nine-member board judged rates at 3.85% were still modestly restrictive, but it was difficult to know how far they could be cut before becoming neutral. "So members observed that it might be prudent to lower interest rates cautiously as the required degree of policy restrictiveness declines," the minutes showed. The three members that argued for a rate cut judged there was already sufficient evidence that inflation was on track to be sustainably back to target, and there was less need to wait before eaing policy further. The RBA surprised markets by holding interest rates steady at the meeting in a rare split of six to three, saying the majority of the board wanted to wait for more information including quarterly price data to confirm inflation was slowing. Traders had wagered heavily on a cut after a monthly inflation report had shown the closely-watched trimmed mean measure hitting a 3-1/2 year low of 2.4% in May. The economy also barely grew in the first quarter as public demand sputtered. In a nod to market pricing, the RBA said there had been instances in the past where markets had been very confident about the outcome of a policy meeting, but the central bank had acted a different other way. The RBA said several data indicators had been in line with or even slightly stronger than forecasts, pointing to the benefit of waiting for a little longer. It noted that even though economic growth was muted in the first quarter, a pick up in private demand was stronger than expected and the labour market had not eased as expected. It noted monthly inflation could be volatile, and components like housing suggest June quarter inflation could be slightly stronger than expected. On top of those reasons, the probability of the gloabl economy evolving in line with the most severe downside secario had declined, although the future state of U.S. trade and other policies was unpredictable. Markets now imply around a 91% chance the RBA will ease again at its next meeting on August 12, after a surprisingly soft jobs report raised concerns that the resilient labour market was finally showing some cracks. Futures see rates bottoming around 3.10% by early next year. (( +61 0 427901124;)) Keywords: AUSTRALIA RBA/MINUTES
Reuters
22-07-2025
- Business
- Reuters
Australia central bank wary of cutting rates too quickly, prudent to await more data
SYDNEY, July 22 (Reuters) - Australia's central bank judged lowering interest rates for a third time within four meetings was not consistent with its strategy of easing in a cautious and gradual manner, a reason that it shocked markets by holding steady this month. Minutes of its July 7-8 policy meeting showed the majority of the Reserve Bank of Australia's nine-member board judged rates at 3.85% were still modestly restrictive, but it was difficult to know how far they could be cut before becoming neutral. "So members observed that it might be prudent to lower interest rates cautiously as the required degree of policy restrictiveness declines," the minutes showed. The three members that argued for a rate cut judged there was already sufficient evidence that inflation was on track to be sustainably back to target, and there was less need to wait before eaing policy further. The RBA surprised markets by holding interest rates steady at the meeting in a rare split of six to three, saying the majority of the board wanted to wait for more information including quarterly price data to confirm inflation was slowing. Traders had wagered heavily on a cut after a monthly inflation report had shown the closely-watched trimmed mean measure hitting a 3-1/2 year low of 2.4% in May. The economy also barely grew in the first quarter as public demand sputtered. In a nod to market pricing, the RBA said there had been instances in the past where markets had been very confident about the outcome of a policy meeting, but the central bank had acted a different other way. The RBA said several data indicators had been in line with or even slightly stronger than forecasts, pointing to the benefit of waiting for a little longer. It noted that even though economic growth was muted in the first quarter, a pick up in private demand was stronger than expected and the labour market had not eased as expected. It noted monthly inflation could be volatile, and components like housing suggest June quarter inflation could be slightly stronger than expected. On top of those reasons, the probability of the gloabl economy evolving in line with the most severe downside secario had declined, although the future state of U.S. trade and other policies was unpredictable. Markets now imply around a 91% chance the RBA will ease again at its next meeting on August 12, after a surprisingly soft jobs report raised concerns that the resilient labour market was finally showing some cracks. Futures see rates bottoming around 3.10% by early next year. (Reporting by Stella Qiu; editing by Wayne Cole) (( opens new tab; +61 0 427901124;)) Keywords: AUSTRALIA RBA/MINUTES
SBS Australia
17-07-2025
- Business
- SBS Australia
Jobless rate rises to highest level since 2021 as number of unemployed Australians jumps
The jobless rate has risen to 4.3 per cent — its highest rate since 2021 — surpassing expectations as the number of unemployed Australians jumped. Financial markets had expected the rate to remain steady at 4.1 per cent in June, but there was a nearly 34,000 increase in people without work, according to the Australian Bureau of Statistics. Employment rose by 2,000, up 2 per cent compared to the same month last year, after part-time employment grew by 40,000 and full-time employment fell by 38,000 people. The Reserve Bank of Australia (RBA) will closely monitor the labour market before its next monetary policy meeting in August, NAB's head of Australian economics Gareth Spence said. "The focus for the RBA will be ensuring the labour market remains healthy going forward," Spence said "The timing of [rate] cuts is not super important. It's more about, where do they end up?" Most economists had pencilled in a 0.25 per cent cut on the back of slowing inflation growth. Spence still expected the jobless rate to climb to 4.4 per cent by the end of 2025, but said economic indicators point to the labour market still being in a strong position. RBA said in its latest monetary policy decision that labour market conditions remained tight. "Measures of labour under-utilisation are at relatively low rates and business surveys and liaison suggest that availability of labour is still a constraint for a range of employers. "Alternatively, labour market outcomes may prove stronger than expected, given the signal from a range of leading indicators."
