The Reserve Bank of Australia kept rates unchanged. Economists at TD Securities highlight takeaways from the meeting.
RBA to keep the target cash rate at current levels until Q3 of next year
The RBA sticks to its central inflation forecast to get inflation back within the 2-3% target range by late 2025 citing recent data, wage growth, and medium-term inflation expectations as consistent with that goal. As such, the RBA appears in no pressing rush to hike.
China risks are unlikely to force the RBA to hike this year, leaving an outsized CPI print later this month or in November as the only real catalyst for the Bank to act by year-end. We expect the RBA to keep the target cash rate at current levels until Q3 of next year but view China risks potentially adding to the case for an insurance hike next year.
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