Ahead of tomorrow's RBA monpol............>

AUSTRALIA: Ahead of tomorrow's RBA monpol decision, analysts at Barclays expect

the RBA to keep policy unchanged given that underlying inflation, though

slightly higher, is at the bottom of the target range and there is elevated

spare capacity in the labour market which has weighed on wage growth.

- CBA suspect the RBA's messaging will not change. That means the cash rate will

be left unchanged. The RBA will send a positive economic message. The policy

emphasis will remain on "patience" and "gradualism" even while acknowledging

that the next rates move is probably "up". The projections will still show a

decent lift in economic growth and gradual progress on inflation rates back into

the 2- 3% target band.

- Citi note Inflation and growth forecasts are unlikely to be changed

materially. Thus there is no incentive for the guidance to change from the

long-standing neutral bias nor from the guidance that the next move is up but

not near term.

- RBC expect another steady interest rate verdict of 1.5% with a firmly neutral

bias intact.