RBA minutes: A further increase of inflation was expected

The minutes of the Reserve Bank of Australia are being drip-fed through the wires adding more colour surrounding the Board’s views and are so far supporting AUD/USD that was already correcting an hourly bearish impulse.

RBA minutes

Inflation had picked up, and a further increase was expected.

Australian economy had remained resilient, and spending was picking up following the setback caused by the outbreak of the omicron variant.

Measures of underlying inflation in the March quarter are expected to be above 3%.

Wages growth had also picked up but, in aggregate terms, had been below rates likely to be consistent with inflation being sustainably at the target.

The strength of the Australian economy was evident in the labour market

These developments have brought forward the likely timing of the first increase in interest rates.

Over the coming months, additional evidence will be available on both inflation and the evolution of labour costs.

Members noted that higher prices for petrol and other commodities would further lift inflation over coming quarters.

Members agreed that financial conditions in Australia remained highly accommodative.

About the RBA minutes

The minutes of the Reserve Bank of Australia meetings are published two weeks after the interest rate decision. The minutes give a complete account of the policy discussion, including differences of view. They also record the votes of the individual members of the Committee. Generally speaking, if the RBA is hawkish about the inflationary outlook for the economy, then the markets see a higher possibility of a rate increase, and that is positive for the AUD.

Share: Feed news

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.