Australia rates on hold ahead of growth data

Australia holds rates at record low, signals weak growth
Australia holds rates as RBA plays long game on economy's growth

07 June, 2017

Economists said the bank would want to digest the growth data before making any concrete rate-related decisions, with gross domestic tipped to come in as low as 0.1 per cent on-quarter and 1.5 per cent on-year in the first three months of 2017.

"Not enough has changed since the last meeting, which saw the Reserve Bank get more optimistic about growth and inflation, and the fact that it's too early to declare victory concerning the Sydney and Melbourne housing market will lead to a situation where they'll leave rates on hold", Mr Oliver said.

"The RBA has opted to downplay the accumulation of evidence that first-quarter GDP will be soft", said David Plank, head of Australian economics at Australia & New Zealand Banking Group Ltd. Projections for tomorrow's first quarter GDP report are for a 0.2% quarter-on-quarter growth. Philip Lowe, the RBA governor, said that his expectations are for economic growth "to increase gradually over the next couple of years to a little above 3%".

The Australian dollar rose, buying 74.90 U.S. cents at 2:58pm in Sydney compared with 74.74 United States cents prior to the decision. Slow growth in real wages is restraining growth in household consumption.

Wide variations in the housing market have also contributed to uncertainty in the economy.

Housing "prices have been rising briskly in some markets, although there are some signs that these conditions are starting to ease", said Lowe, adding that lenders have increased their mortgage rates, particularly for investors and interest-only loans.

Trump likely to withdraw U.S. from Paris climate accord, senior official says
But the targets were voluntary, meaning the USA and the almost 200 other nations in the agreement could alter their commitments. Trump thinks that the climate change was something invented by the Chinese to stop USA companies from making a lot of money.

After Stabbing, Portland's Mayor Wants 2 Right-Wing Demonstrations Canceled
Since Trump's election, Portland has led all major metropolitan areas in reported hate crimes , Mayor Ted Wheeler's office said . Christian served prison time after holding up employees at a convenience store with a gun in 2002, court records show.

Malaysia Airlines Passenger Cockpit Attempt Disrupts Flight
Police are now speaking with passengers who were onboard the flight as part for their investigation into the incident. Armed law enforcement have boarded Malaysia Airlines flight #MH128 after a security incident at Melbourne Airport.

The jobless rate dropped to 5.7% in May after a second straight month of solid employment gains, yet wage growth has been stagnant, suggesting a fair amount of slack in the market.

"The last thing the RBA wants is another surge in house price growth, fuelled by unsustainable growth in household leverage", he said.

While much of the market commentary in recent months has pointed toward an upward trajectory for the official cash rate, there are growing signs that the RBA's easing cycle may not be over.

"They are going to overlook the slowdown in GDP as a temporary blip".

However, Westpac has now halved its GDP forecast to a 0.2 per cent rise for the quarter and Commonwealth Bank has lowered its prediction from 0.3 per cent to 0.1 per cent, while National Australian Bank is sticking with its call for a 0.1 per cent contraction in the quarter "with slight downside risks".

More news

  • Foo Fighters Crank Up the Heavy on New Song 'Run'

    Foo Fighters Crank Up the Heavy on New Song 'Run'

    The song was released as a complete surprise, but what we're not shocked to hear is that Dave Grohl directed the music video. The song kicks into high gear with some super heavy riffs, crashing drums, and Grohl mixing in some screams with the vocals.
    Lawmakers: Trump should make good on campaign pledge on Jerusalem

    Lawmakers: Trump should make good on campaign pledge on Jerusalem

    We are also excited about the new possibilities of increased cooperation and even peace between Israel and the Arab world. Phased over a 10-year period, U.S. administration officials say it is the biggest single arms deal in American history.
    Young IAS official tries to rescue lady colleague, drowns in pool

    Young IAS official tries to rescue lady colleague, drowns in pool

    Suspecting foul play, the family has demanded a CBI probe into the incident if Delhi Police fails to get any breakthrough soon. DCP (south) Ishwar Singh told The Indian Express that prima facie, the cause of death appears to be drowning.
  • Man with new tattoo dies after getting flesh eating bacteria while swimming

    Man with new tattoo dies after getting flesh eating bacteria while swimming

    The Metro report added that there may have been some other factors in the man's death and infection by flesh-eating bacteria. Shortly after swimming , he began to experience fever, chills and a rash close to the new tattoo , Yahoo7 reports.

    'Friendly fire' kills 11 soldiers and wounds seven in Philippines

    Defense Secretary Delfin Lorenzana is sticking to his self-imposed deadline to finish the crisis in Marawi by Friday, June 2. It appears that the military record still does not include the 10 deaths from the airstrikes.
    Day 2: Deepika Padukone dazzles at Cannes Film Festival

    Day 2: Deepika Padukone dazzles at Cannes Film Festival

    The festival wraps up on May 28th so we can expect plenty more radiant red carpet style moments until then. She continues to experiment, and she probably will, until she gets it right with thigh-high slit dresses.
  • Putin: Syria chemical attack was provocation against Assad

    World leaders on six continents condemned the decision, as did several United States governors and mayors. If there is something specific, then it will be a subject of discussion", Putin said. "That's his job.
    Walmart employees will now deliver online orders to customers' homes

    Walmart employees will now deliver online orders to customers' homes

    Expect Walmart to expand it rapidly, and other retailers to watch closely and follow suit. Workers can opt in to earn extra money by making deliveries using their own cars.

    Trump dismisses 'fabricated' report of son-in-law's outreach to Russian Federation

    He is respected by virtually everyone and is working on programs that will save our country billions of dollars. But he did not directly address allegations made against the man married to his eldest daughter, Ivanka.
  • Highlights of the NDP-Green deal in British Columbia

    Highlights of the NDP-Green deal in British Columbia

    Green Party Leader Andrew Weaver have signed an accord to defeat Clark and install a minority NDP government. If her prediction pans out, NDP leader John Horgan will become premier.
    Phil Mickelson withdraws from US Open

    Phil Mickelson withdraws from US Open

    Mickelson has not officially withdrawn, but it seems only a first-round weather washout could allow him to participate. Phil Mickelson is putting family first as he opts to skip the only major he's never won for daughter's graduation.

    Goldman under fire for buying Venezuela "hunger bonds"

    Shares of the company dropped 2 percent to $218.42 at 4 p.m., the biggest decline in the Dow Jones Industrial Average. Goldman wasn't the only firm to do a private deal recently that helped the government raise funds.