Societe Generale’s Stephen Spratt notes that the Reserve Bank of Australia kept rates unchanged at 4.35%, in line with expectations, and characterizes the statement as largely a mark-to-market update. He highlights the acknowledged slowdown in Australian growth, removal of explicit upside inflation risk language, and a maintained bias that further tightening is only a conditional threat, with the base case still for no change in RBA policy.

RBA hold framed as conditional threat

"Bottom line: The statement was a mark-to-market exercise, noting the slowdown in growth and removing the reference to upside inflation risks."

"While CPI remains “too high”, the worst tails have been clipped."

"RBA says another hike would be delivered if needed."

"A credible threat but this is not an economy which needs more restriction."

"Gov. Bullock stuck to the core RBA narrative that a slowdown in growth is necessary to bring the economy into better balance and slow inflation."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)