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MNI INTERVIEW: RBA Could Shift Tone Rapidly - Ex Economist

A former RBA economist shares his cash rate outlook.

MNI (SYDNEY) - The Reserve Bank of Australia’s tone on rate cuts could shift rapidly over the next two months should unemployment spike or consumer spending disappoint, with a 25% chance of a reduction to the 4.35% cash rate at either the November or December meeting, a former RBA economist told MNI. 

“February is probably the base case for things kicking off, but there’s two meetings before then,” said Justin Fabo, founder and head of research at Antipodean Macro and former head of international financial markets at the RBA, noting the Reserve’s board had not discussed rate hikes at its September meeting. (See MNI RBA WATCH: Changed Messaging Considered In Hawkish Hold)

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MNI (SYDNEY) - The Reserve Bank of Australia’s tone on rate cuts could shift rapidly over the next two months should unemployment spike or consumer spending disappoint, with a 25% chance of a reduction to the 4.35% cash rate at either the November or December meeting, a former RBA economist told MNI. 

“February is probably the base case for things kicking off, but there’s two meetings before then,” said Justin Fabo, founder and head of research at Antipodean Macro and former head of international financial markets at the RBA, noting the Reserve’s board had not discussed rate hikes at its September meeting. (See MNI RBA WATCH: Changed Messaging Considered In Hawkish Hold)

Keep reading...Show less