RBA: Stays patient, but the next move is set to be up - HSBC

The RBA held its cash rate steady at 1.50%, which was no surprise but for some, the neutral tone of the post-meeting statement, which was as HSBC had expected, might have been a bit disappointing, explains the analysis team at HSBC.

Key quotes

“Unlike a number of other central banks that have turned hawkish in recent weeks (including Bank of Canada and Norges Bank), the RBA maintained a clear neutral stance. The post-meeting statement was similar to last month and the RBA felt no need to give any forward guidance. This is classic RBA style. Despite the improving labour market numbers, the RBA stuck by its previous phrasing of 'indicators of the labour market remain mixed' and that wages growth remains low and 'that this is likely to continue for a while yet'. As a result, the AUD fell and short end pricing moved a few basis points lower. Our central view is that the RBA will lift its cash rate in Q1 2018.”