VIEW: ANZ write "the focus on making "faster....>

RBA: VIEW: ANZ write "the focus on making "faster progress in reducing

unemployment" sets a high hurdle for NOT easing again. Most of the forward

indicators, with the important exception of ABS job vacancies, suggest that

progress on reducing the unemployment rate has stalled (if not reversed). It

will likely take some effort to get these indicators and the unemployment rate

itself moving in the right direction. This effectively guarantees at least one

further rate cut, in our view, with the clear risk of more rather than less -

even with fiscal policy giving a helping hand in H219. It will be interesting

whether the RBA provides any additional clarity on how it will judge progress in

the labour market. The Governor's speech tonight, the title of which has been

revealed as Today's Reduction in the Cash Rate, may give us this clarity. As

things stand the market could be excused from assuming that even a sideways move

in the unemployment rate, let alone a bump higher, will deliver a rate cut at

the next RBA meeting. We doubt this what this RBA is signalling. While we think

there will be a further easing in coming months, our view is that the RBA will

display some patience, given it doesn't have a lot of policy space."