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17 Sep 2013
RBA minutes keeps relatively neutral tone
FXstreet.com (Barcelona) - The minutes of the Reserve Bank of Australia September 3 meeting remained relatively neutral, after the RBA emphasized again that 'the Bank should again neither close off the possibility of reducing rates further nor signal an imminent intention to reduce them.'
Key Quotes from the minutes Sept 3
Overall, growth of Australia's major trading partners in the June quarter was around its average of the past decade and recent indicators suggested that this pace of growth had continued. The Chinese economy was growing at around the pace evident since the start of the year, and members noted that indications were that GDP growth was likely to remain close to the authorities' target of 7.5 per cent over the remainder of the year.
Labour market conditions remained somewhat subdued. Employment had been little changed since earlier in the year, while the population had continued to expand, resulting in a decline in the employment-to-population ratio and a gradual rise in the unemployment rate. Average hours worked had picked up, although members noted that these data tend to be volatile.
For the domestic economy, GDP looked to have grown at a pace that was a little below trend in the June quarter and more timely data suggested a similar pace of growth over recent months. Household spending looked to have been growing at somewhat below average, although measures of consumer confidence had picked up and were a little above average.
Conditions in the housing market had continued to improve in response to the current low level of lending rates.
Mining investment was expected to decline over the course of the next few years. With investment projects reaching completion, the strong growth in exports of bulk commodities was expected to continue for some years. Indicators of conditions elsewhere in the business sector remained subdued.
Lending rates had declined to historically low levels as a result, which, together with the lower – though still high – exchange rate, were continuing to provide a substantial degree of policy stimulus to the economy.
Given the substantial degree of policy stimulus in place, the Board judged that it was appropriate to retain the current setting of interest rates. Members agreed that the Bank should again neither close off the possibility of reducing rates further nor signal an imminent intention to reduce them. The Board would continue to examine the data over the months ahead to assess whether monetary policy was appropriately configured.
Key Quotes from the minutes Sept 3
Overall, growth of Australia's major trading partners in the June quarter was around its average of the past decade and recent indicators suggested that this pace of growth had continued. The Chinese economy was growing at around the pace evident since the start of the year, and members noted that indications were that GDP growth was likely to remain close to the authorities' target of 7.5 per cent over the remainder of the year.
Labour market conditions remained somewhat subdued. Employment had been little changed since earlier in the year, while the population had continued to expand, resulting in a decline in the employment-to-population ratio and a gradual rise in the unemployment rate. Average hours worked had picked up, although members noted that these data tend to be volatile.
For the domestic economy, GDP looked to have grown at a pace that was a little below trend in the June quarter and more timely data suggested a similar pace of growth over recent months. Household spending looked to have been growing at somewhat below average, although measures of consumer confidence had picked up and were a little above average.
Conditions in the housing market had continued to improve in response to the current low level of lending rates.
Mining investment was expected to decline over the course of the next few years. With investment projects reaching completion, the strong growth in exports of bulk commodities was expected to continue for some years. Indicators of conditions elsewhere in the business sector remained subdued.
Lending rates had declined to historically low levels as a result, which, together with the lower – though still high – exchange rate, were continuing to provide a substantial degree of policy stimulus to the economy.
Given the substantial degree of policy stimulus in place, the Board judged that it was appropriate to retain the current setting of interest rates. Members agreed that the Bank should again neither close off the possibility of reducing rates further nor signal an imminent intention to reduce them. The Board would continue to examine the data over the months ahead to assess whether monetary policy was appropriately configured.