Tuesday brought RBA Meeting Minutes from Australia. At its latest meeting RBA decided, on the basis of their assessment of current conditions and taking into account the revised forecasts, to reduce further cash rate in order to provide additional stimulus. According to the Minutes, "the restrained pace of wage increases over the past year or so and accompanying growth in productivity, which had dampened growth in unit labour costs, suggested that low rates of inflation were likely to be sustained."
As for exchange rates it was noted that the Australian dollar had depreciated noticeably against a rising US dollar over recent months, although less so against a basket of currencies, and that it remained above most estimates of its fundamental value, particularly given the significant declines in key commodity prices. Members agreed that a lower exchange rate was likely to be needed to achieve balanced growth in the economy.
This week markets will be looking at:
Construction Work Done (Wednesday 1:30)
Wage Price Index (Wednesday 1:30)
HSBC Flash Manufacturing PMI (Wednesday 2:45)
Private Capital Expenditure (Thursday 1:30)
Last modified on Friday, 20 February 2015
