AUSTRALIA VIEW: *** Bank views on today's RBA........>

AUSTRALIA VIEW: *** Bank views on today's RBA MonPol Decision (2/2):

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

neutral bias intact. Since the board last met, key domestic data have been mixed

with a disappointing Mar labour force report highlighting a weakening employment

trend and softer housing data but a bounce in Feb retail sales and core

inflation creeping slightly higher in Q1 to almost 2%. None of this is likely to

shift the RBA's base case for a return to above trend growth and within target

inflation. We expect the post meeting statement and SoMP to strike a generally

positive tone although it may be tempered by the acknowledgement of some recent

moderation in employment generation and softer housing data.

- Westpac: The RBA Board will leave rates unchanged at their May meeting. The

Governor has stated that: "further progress in reducing unemployment and having

inflation return to target is expected, although this progress is likely to be

gradual". The case for patience has been reinforced by recent data.