MNI BRIEF: RBA Gov Defends Pre-Cut Communications
MNI (MELBOURNE) - The Reserve Bank of Australia board needed to weigh risks around pausing or cutting the cash rate at this weeks meeting, despite the market accurately pricing in the 25 basis point cut to 4.10%, Governor Michele Bullock told the House of Representatives Standing Committee on Economics Friday.
Bullock pushed back against suggestions the Bank should have refined its messaging before the meeting to temper expectations. (See MNI RBA WATCH: Board Delivers Hawkish 25BP Cut)
“We gave signals in December in terms of our communication that we we've noticed some good progress, and we were looking for good progress,” she said, pointing to the Reserve's more dovish tilt at the December meeting. “Yes, there was good news on inflation, and there were good reasons to think about starting to ease policy, but also had to think about what were the reasons why we might not as well. And so we had to have a vibrant discussion about that which the board did on both sides, and then decided that the right thing to do was to lower the interest rate a bit.”