RBA SoMP: RBA is prepared to be patient as it monitors how the various factors affecting inflation in Australia evolve

The RBA Monetary Policy Statement (SoMP) has been released by the Reserve bank of Australia with key notes outlined as follows:

SoMP, key notes

• Says board is prepared to be patient as it monitors how the various factors affecting inflation in Australia evolve.
• Says progress towards the bank's goals has been material, but significant uncertainties surround the inflation outlook.
• Says  Australia has been affected by these global inflationary pressures, but to a lesser extent than some other advanced economies.
• Says upstream cost pressures in housing construction and durable goods are expected to push underlying inflation higher in the near term, but moderate over time.
• Says if realised, staff inflation forecasts imply that the bank's policy goals would be achieved sooner than previously envisaged.
• RBA sees sees jobless rate 3.75% in year to June 2024;
• - uncertainties over labour supply as borders reopen.
• Sees trimmed mean inflation 2.75% in year to June 2024;
• - significant uncertainties surround inflation outlook.
• Sees GDP growth 2% in year to June 2024;
• - progress toward bank's goals has been `material'
• Sees wage growth 3.25% in year to June 2024;
• - pickup in aggregate wages growth likely to be only gradual.

AUD/USD update

AUD/USD Price Analysis: Bulls stay in charge but face a wall of daily resistance

The price is consolidated at this juncture and there needs to be a break of H4 structure, one way or the other, before a trend would be offering trader's an opportunity.

About the SoMP

The RBA Monetary Policy Statement released by the Reserve bank of Australia reviews economic and financial conditions, determines the appropriate stance of monetary policy and assesses the risks to its long-run goals of price stability and sustainable economic growth. It is considered as a clear guide to the future RBA interest rate policy. Any changes in this report affect the AUD volatility. If the RBA statement shows a hawkish outlook, that is seen as positive (or bullish) for the AUD, while a dovish outlook is seen as negatvie (or bearish).