Could the Reserve Bank be planning an interest rate hike later this year, perhaps on the day that traditionally stops everyone across the nation except those on the RBA Board – Melbourne Cup Day?
Maybe, just maybe.
Indeed, just when every economist around the country was prepared to write-off yesterday’s release of the RBA’s minutes from its recent policy meeting as nothing new, the Bank saw fit to drop an added line into the commentary – and one that Governor Lowe has been at pains to raise in recent months.
Just so there’s no confusion, the Bank indicated “[Board] members agreed that it was more likely that the next move in the cash rate would be up, rather than down.”
What could cause the RBA to lift rates? It was indicated in the very next sentence ”as progress in lowering unemployment and having inflation return to the midpoint of the target was expected to be only gradual, members also agreed that there was not a strong case for a near-term adjustment in monetary policy.”
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