VIEW: CBA write "the RBA delivered an "as.......>

RBA: VIEW: CBA write "the RBA delivered an "as expected" outcome at the November

Board meeting, leaving the cash rate unchanged at 0.75%. The forward guidance,

however, was also unchanged. The RBA stands ready to cut again "if needed".

Views on prospects for a near-term change in monetary policy settings have

shifted significantly. Not so long ago the November meeting was seen as "live"

and markets were willing to price the odds of a cut at more than 50%. But signs

of progress on the trade war front, a tick down in the Australian unemployment

rate, some positive RBA economic commentary, a chunky rise in house prices and

an on-consensus CPI outcome have moved the policy dial. The shift has moved

beyond the near term as well. The market is less happy with the idea that the

next move is "down". The timing of any move has been pushed back into 2020. And

the market is questioning whether the terminal rate will in fact be 0.5% or

lower. Nevertheless, we are holding to our view that a further 25bpt cash rate

cut to 0.5% is likely by February 2020."