Bullock Doesn't Move The Needle

RBA Deputy Governor Bullock's speech touches on the advantage of the high frequency of the RBA's monetary policy meetings: "It means that if we increase interest rates at every meeting, we can potentially move much faster than overseas central banks. Or, alternatively, we can achieve a similar rise in interest rates with smaller increments. The incremental change in the policy rate at recent meetings has been smaller than some other major central banks. However, our policy rate trajectory has been as steep, or steeper, than other central banks."

• She noted that the October decision saw "an active discussion both internally and at the Board meeting about the appropriate size of the increase."
• Her comments on the economy are familiar, "the labour market is very tight – unemployment is as low as it has been in around 50 years – and this is starting to put upward pressure on wages."
• "There has already been a substantial rise in interest rates since May, which, along with price rises, is beginning to put pressure on household budgets. How household spending will respond to this is uncertain. The international economic environment has also deteriorated quite sharply. For these reasons, the Board felt that a smaller increase in October was warranted while it took stock of developments in consumption, wages and the international economy"
• "The Board expects to increase interest rates further over coming months. But the pace and timing will be determined by the economic data. Factors that the Board will be monitoring closely include the global economy, household spending and wage- and price-setting behaviour. You should be in no doubt, though, that the Board is determined to do what is necessary to return inflation to target."
• Focus now moves to the Q&A session that will follow.