On the outlook for inflation, the sole reason cited by many analysts to justify an additional rate cut, the board acknowledged that “recent data confirm that inflation remains quite low”. “Given very subdued growth in labour costs and very low cost pressures elsewhere in the world, this is expected to remain the case for some time,” the statement read. Contributing to weak inflationary pressures through heightened levels of labour market slack, the RBA noted that “labour market indicators continue to be somewhat mixed”, although acknowledged that it remains “consistent with a modest pace of expansion in employment in the near term”.
Aussie is currently being traded around 0.7530 area. Pair is likely to find support around 0.75 handle and resistance above 0.76 level.
