Cash Rate – No change
The Reserve Bank of Australia (RBA) has just announced it will maintain the official cash rate at 1.50%.
A raft of economic data over coming days (building approvals, business capital expenditure, inventory and company operating profit figures) will contribute to June’s GDP figures, released later this week. Business conditions are at the highest level since before the 2008 financial crisis, however consumer sentiment continues to travel in the opposite direction with August marking the ninth month where pessimists outnumbered optimists. The Australian dollar has risen more than 10 US cents since early last year, influenced more recently by the uncertainty around the success or otherwise of the Trump administration’s planned infrastructure spending, tax cuts and deregulation.
Australia’s stubbornly low inflation and subdued wage growth continues to provide confidence that there will be little change to the cash rate until well into 2018.
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