The RBA today has decided leave cash rates unchanged but no longer supporting the longer dated yield.
The RBA is still expecting strong economic figures and keeping an eye on inflation.
There are 6 points to the announcement today:
- Australia’s economic recovery has been stronger than expected. Expecting 5.5% growth next year.
- Unemployment rate to trend lower to 4% by the end of 2023.
- Underlying inflation is still low at 2.1% but headline CPI at 3% due to petrol prices and construction prices.
- House prices continue to rise. Lending standards have been maintained.
- Discontinuing the longer dated yield targets [meaning longer term fixed rates have been and will continue to increase].
- The RBA still doesn’t expect to raise by the end of 2023.
More details at https://www.rba.gov.au/