RBA minutes to be dissected for interest rate clues

Poppy Johnston | July 2, 2024

The thinking behind the Reserve Bank of Australia’s last interest rate call will be laid out in minutes from June meeting.

Tuesday’s release follows strong monthly inflation numbers last week, which shook up financial markets and increased the threat of another rate hike or a longer wait for cuts.

With the June decision to keep interest rates on hold universally expected and a couple of public appearances by central bank officials in the meantime, the minutes are unlikely to contain a wealth of new information.

Governor Michele Bullock has already revealed the case for a hike was discussed but board members did not consider cutting rates.

But the board’s assessment of the economy and risks to the outlook will still be informative ahead of the next meeting in August.

Westpac chief economist Luci Ellis said monthly inflation rising four per cent, above consensus forecasts of a 3.8 per cent, was unlikely to have surprised the RBA.

“An ugly June quarter consumer price index release together with strong labour market data could tip the balance and force a rate hike, but this is not our base case and is not supported by currently available information,” the former RBA assistant governor wrote in a note.