Back
18 Apr 2014
Can the RBA turn cautiously hawkish on next week's inflation report? - TDS
FXStreet (Bali) - According to Annette Beacher and Prash Newnaha, FX Strategists at TD Securities, next week's inflation numbers in Australia may be the last straw in the camel's back for the RBA to make yet another upturn in policy stance, moving from neutral to cautiously hawkish, should price pressures increase, an outcome expected by the TD Securities team.
Key Quotes
"Unlike many global central banks that have shifted and tweaked their policy focus in recent years, the RBA has been steadfast about its inflation target of 2-3% over the medium term."
"RBA Governor Stevens’ record had been impressive, bringing down underlying inflation from near-5%/yr (due to the first commodity price boom) without creating a recession."
"Now the challenge is to manage another upturn, and after consecutive quarters of ‘higher than expected’ underlying inflation, we expect another pop to near-3%/yr next week."
"The average underlying inflation rate under RBA Governor Glenn Stevens is now 3.1%/yr, above the 2-3% target band (his predecessor Ian Macfarlane achieved mid-target 2.6% during his tenure)."
"No wonder the RBA Governor is worried about inflation and has ceased jawboning the currency lower in recent months."
Key Quotes
"Unlike many global central banks that have shifted and tweaked their policy focus in recent years, the RBA has been steadfast about its inflation target of 2-3% over the medium term."
"RBA Governor Stevens’ record had been impressive, bringing down underlying inflation from near-5%/yr (due to the first commodity price boom) without creating a recession."
"Now the challenge is to manage another upturn, and after consecutive quarters of ‘higher than expected’ underlying inflation, we expect another pop to near-3%/yr next week."
"The average underlying inflation rate under RBA Governor Glenn Stevens is now 3.1%/yr, above the 2-3% target band (his predecessor Ian Macfarlane achieved mid-target 2.6% during his tenure)."
"No wonder the RBA Governor is worried about inflation and has ceased jawboning the currency lower in recent months."