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Weekly Economic Commentary

Weekly Economic Commentary

Categories: General, General

The economists of two major banks have changed their view on monetary policy and have brought forward their timing of an anticipated RBA rate increase to mid-2018 reflecting a more positive growth outlook, continuing strength in the global economy, an expected gradual rise in inflation and wages and a more upbeat commentary from the latest RBA Board minutes. Conversely, one is still calling no change to the cash rate till mid-2019.

Financial market pricing has one RBA rate increase now fully priced in by July 18 and almost three others by the end of 2019. This is despite the RBA Governor Philip Lowe delivering a speech last Thursday which suggested that the RBA was in no rush to raise interest rates.

The hung parliaments after elections in New Zealand and Germany over the weekend will mean the ruling parties (although re-elected) cannot govern in their own right and will need to negotiate deals with minor parties to form government.

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Source: Rural Bank


Disclaimer: Whilst all care has been taken in compiling the information, the information should not be relied upon as substitute for professional advice where necessary. Rural Bank accepts no responsibility for the accuracy, completeness or timeliness of the information and disclaims all liability in relation to any loss or damage suffered by the use of or reliance upon any information contained herein or in any attachment or annexure hereto by any person. Rural Bank – A Division of Bendigo and Adelaide Bank Limited ABN 11 068 049 178 AFSL 237879