RBA trims inflation projections on low wage growth

AUD  USD Daily Price Chart

The June quarter inflation outcomes were in line with the forecasts in the May Statement.

Inflation has consistently undershot the RBA's target since early 2015 and was the major reason for the central bank cutting interest rates to the record low 1.5 per cent in August 2016 - where rates have been since then.

The RBA now sees underlying inflation slowing to 1.75 percent by the end of this year, down from a previous forecast of 2 percent.

Beyond that time frame, the central bank kept its inflation forecasts relatively unchanged.

Wages have edged higher in the past year but income growth remains below its long-term average and consumers are still watching their spending as a result, the Reserve Bank says.

In Tuesday's rate announcement, Lowe also said that "a further gradual decline in the unemployment rate is expected over the next couple of years to around 5%".

Full employment (around 5 per cent unemployment) is not expected to happen until the end of 2020.

PGA Championship: Tiger Woods flirting with cut line
He has not made a putt of longer than 17 feet over three days, and has only made five putts of more than 10 feet all week. The problem is it is a lot to ask for Woods to hit the ball that well again and give himself those kind of opportunities.

Indian envoy Ajay Bisaria meets Imran Khan, gifts him a bat
The former cricketer said that he has sent the invite to Union Home Ministry and Punjab Chief Minister Amarinder Singh. But he has cleared that he won't be travelling to Pakistan and has declined the invitation.

Two presidential candidates register for Indonesia polls next year
Shihab was among the leaders of Muslim groups behind the blasphemy campaign against Ahok, an ally of Jokowi. Amin had been a presidential adviser and had served in local and national legislatures in the past.

A drop in electricity prices across some Australian cities, coupled with reduced child care and other service prices are attributed for the near-term downgrade.

The Reserve Bank of Australia (RBA) expects growth in the A$1.8 trillion economy to accelerate to 3.25 percent in 2018 and 2019 before easing slightly to 3 percent in 2020. Longer-term, the bank's growth projections were little-changed.

Most noticeably, the changes in today's SoMP is the RBA's inflation projections. The central bank still expects underlying inflation to return to the bottom end of its 2-3% target range by 2020. Previously, it expected both core and underlying inflation to reach 2.25% by the middle of 2020.

The latest set of projections confirmed that the RBA still looks set to keep interest rates on hold for the foreseeable future.

Annette Beacher, Chief Asia-Pacific Macro Strategist at TD Securities, notes that the RBA delivered an as-expected upbeat outlook for the global economy and constructive view on the domestic economy.

"Given the gradual nature of the improvement, however, the Board does not see a strong case to adjust the cash rate in the near term".

Subdued wages growth, at around 2 per cent, is also adding downward pressure on consumer prices despite a solid run of jobs growth since 2017.

Related News:



Most liked

Butlin's targeted by data hackers
The holiday firm, which has a site in Bognor Regis, West Sussex, said it takes guest data seriously. The holiday company has insisted that no financial details were accessed in the breach.

Emery in spotlight as Arsenal start campaign
It is expected that the former Sampdoria midfielder will start alongside Aaron Ramsey at the base of Arsenal's 4-2-3-1 formation. Emery's philosophy will be put to the test immediately this season as his side takes on champions Manchester City on Sunday.

Ex-Arsenal Santi Cazorla unveiled by Villarreal with bizarre magic stunt
After a while, as the smoke cleared, out came Santi Cazorla from inside the chamber. How the magician achieved the feat no one in the stadium could work out.

Sarri not aiming to repeat Napoli formula at Chelsea
" Chelsea really understood the situation and really helped [to finalise the deal]", Henrotay said. So I hope he can improve very fast.

Bairstow & Woakes put England in strong position at Lord’s
On the stroke of lunch, the impressive Shami picked up his second wicket with a ball that kept low and cannoned into Root's pads. Woakes struck an unbeaten 120 to take England to 357-6 and a 250-run lead over top-ranked India at stumps on Saturday.

Worth Watching Stock Dropbox, Inc. (DBX)
If the markets make a firm price movement, then the strength of that movement depends on the volume for that period. DA Davidson also issued estimates for Dropbox's Q3 2019 earnings at $0.09 EPS and Q4 2019 earnings at $0.11 EPS.

Trump calls for peace on Charlottesville anniversary as residents on edge
Some leading figures in the USA white nationalist movement have said they won't attend or have encouraged supporters to stay away. Hundreds of students and protesters descended on Charlottesville's downtown mall and the University of Virginia on Saturday.

Former Brazilian superstar footballer Ronaldo in intensive care
Ronaldo , 41, was diagnosed with the illness after being rushed to Can Misses Hospital on the Spanish Island on Friday evening. Ronaldo , regarded as one of the world's best-ever players, owns a house in Ibiza and is a regular visitor to the island.

Nike Hit With Lawsuit From Ex-Employees Alleging Discrimination
She claimed in the lawsuit that she was paid $20,000 (Dh73,464) a year less in 2017 than a male co-worker doing much the same job. The lawsuit claims that Nike is at fault for failing to "assure a non-hostile work environment that provided equal opportunity".

Local aviation expert weighs in on Seattle plane theft and crash
The man, described by police as a 29-year-old mechanic, says that he has a lot of people that care about him. He expected "a whole slew of engines that will be coming through at the ferry terminal in a few minutes".

Leicester to debut possession game at United, says Schmeichel
Maguire was one of the surprise stars of this summer's World Cup, playing a key role in England's run to the semi-finals. They [Leicester] are recently champions and after that the stability of being in the first half of the table.

At least 4 people killed as Jordan police raid terrorists' hideout
The side of the building partially collapsed, possibly because of a blast from a suicide bomber inside, a security source said. The security forces eventually arrested three suspects, she said, adding that the operation in Salt was still "ongoing".

Tech stocks drive Nasdaq higher; Dow, S&P flat
Shares of trade-sensitive companies also declined, including Boeing, 3M and Caterpillar, which were all down at least 1.4 percent. Microchip's shares fell 10.5 percent, the biggest decliner on the S&P, after it forecast disappointing second-quarter revenue.

Torchlight Frontiers announced for PS4, Xbox One, and PC
Perfect World will reveal more information about the game at unspecified date in the future. With her soldiers riled up for the battle ahead, they charge headlong towards a portal.

Paul Pogba named Manchester United captain against Leicester
Pogba said "everybody was on the same page" in the France dressing room, from manager Didier Deschamps to the staff and players. Paul Pogba is demonstrating the power he has at Manchester United to Jose Mourinho , Sam Wallace told the Sunday Supplement .