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RBA Monetary Policy Meeting Tuesday March 5 –

Some excerpts from the previews of the Reserve Bank of Australia’s policy meeting tomorrow.


  • given that the data continues to beat its forecast with the unemployment rate already at 4% and expected to drop below 4% next month, a bigger nod to risk balancing in the statement post -meeting would provide some guidance on a more nimble framework, which we think is necessary given that the Q1 CPI is likely to surprise the RBA (NAB penciled in a Q1 adjusted average impression of 1, 2% q/q vs. RBA February forecast of 0.8%).

NAB is correct on inflation likely to surprise higher, if today’s monthly CPI data is any guide:

Australia, monthly inflation indicator (March): Headline inflation: +0.8% m/m to 4.0% y/y

The trimmed mean of this data was also strong. Down from the February reading, but that’s pretty much just a base effect. The average adjusted q/q was 1.4%, well above the RBA forecast of 0.7-0.8% q/q.


  • We estimate that the RBA will enter a tightening cycle from June 2022 with a 15 basis point increase in the cash rate target. While we expect the cash rate to remain at 0.1% at the April board meeting next week, we will await any change in language from the RBA Governor.
  • Specifically, we clearly see the risk of the RBA Governor removing the line that “the board stands ready for patience” from his post-meeting statement.

This from BNZ earlier:

Reserve Bank of Australia monetary policy meeting this week – ‘non-event’

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