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11 May 2015
RBA to keep rates on hold for some time, next move likely to be rate hike - NAB
FXStreet (Mumbai) - The Reserve Bank of Australia (RBA) will keep rates steady for some time and in late 2016 will eventually raise them, the National Australia Bank (NAB) said on Monday.
NAB stated in its report, "Domestic forecasts are at 2.3% for 2014/15 and around 3% for 2015/16,"
"The economy is still struggling to offset the impact of falling mining investment on domestic demand, while low commodity prices are also crunching income flows and government finances. Against that non-mining investment remains a disappointment."
"Further falls in the AUD should help offse the out years expected to be around 3%, unemployment, after peaking at around 6.4% by end 2015, will remain elevated,"
"The RBA cut in May was always going to be a line ball decision and came a little earlier than we had expected. While there is still the risk of further cuts, recent improvements in the economy suggest the RBA will pause for some time, with the next likely move to be up (although the timing will be very data dependent). We currently expect the first hike to be very late in 2016."
NAB stated in its report, "Domestic forecasts are at 2.3% for 2014/15 and around 3% for 2015/16,"
"The economy is still struggling to offset the impact of falling mining investment on domestic demand, while low commodity prices are also crunching income flows and government finances. Against that non-mining investment remains a disappointment."
"Further falls in the AUD should help offse the out years expected to be around 3%, unemployment, after peaking at around 6.4% by end 2015, will remain elevated,"
"The RBA cut in May was always going to be a line ball decision and came a little earlier than we had expected. While there is still the risk of further cuts, recent improvements in the economy suggest the RBA will pause for some time, with the next likely move to be up (although the timing will be very data dependent). We currently expect the first hike to be very late in 2016."