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RBA Signals August Rate Cut Is Far From Certain Despite Market Bets

Unemployment rose to 4.3% as forecast with policy set to remain on hold pending upcoming inflation data

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A worker is reflected in a wall of the Reserve Bank of Australia (RBA) head office in central Sydney, Australia, March 1, 2016. REUTERS/David Gray/File Photo
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Overview

  • Board reaffirms a measured, gradual approach to easing monetary policy and remains data dependent ahead of its August meeting.
  • The jobless rate climbed to 4.3% in June, its highest since the pandemic but squarely in line with forecasts released in May.
  • Governor Michele Bullock highlighted stable vacancy rates and modest adjustments in hours worked and voluntary job switches as evidence of orderly labour-market rebalancing.
  • Core inflation eased to 2.9% in the March quarter and is projected to fall further to about 2.7% when June-quarter figures are released next week.
  • A rare 6–3 split vote held the cash rate at 3.85% earlier this month, underscoring the bank’s caution before fresh employment and inflation data arrive.