No rate cut from the RBA on Tuesday and no increase as well — the cash rate remains at 4.35 per cent for as long as the central bank thinks it is needed to cool inflation.
And that will be quite a while yet, judging by the statement from Governor Michell Bullock post meeting.
So, in effect, no change in the policy stance from the first meeting of 2024 in February, and there will probably be little chance of a rate cut this year if inflation remains persistent.
The final paragraph of the Governor’s statement repeated sentiments in previous statements which can be summed up as "no change".
"While recent data indicate that inflation is easing, it remains high. The Board expects that it will be some time yet before inflation is sustainably in the target range.
"The path of interest rates that will best ensure that inflation returns to target in a reasonable timeframe remains uncertain and the Board is not ruling anything in or out. The Board will rely upon the data and the evolving assessment of risks.
"The Board will continue to pay close attention to developments in the global economy, trends in domestic demand, and the outlook for inflation and the labour market. The Board remains resolute in its determination to return inflation to target."
"While there are encouraging signs that inflation is moderating, the economic outlook remains uncertain.
"The December quarter national accounts data confirmed growth has slowed. Household consumption growth remains particularly weak amid high inflation and the rise in interest rates.
"After recent declines, real incomes have stabilised and are expected to grow from here, which is expected to support growth in consumption later in the year.
"Returning inflation to target within a reasonable timeframe remains the Board’s highest priority. This is consistent with the RBA’s mandate for price stability and full employment. The Board needs to be confident that inflation is moving sustainably towards the target range.
"To date, medium-term inflation expectations have been consistent with the inflation target and it is important that this remains the case,” Ms Bullock said.
Thursday sees the release of the February labour market data and whether there’s a rebound in new job numbers after the weakness in January.
