VIEW: Less than two months after pushing back...>

RBA: VIEW: Less than two months after pushing back their forecast for the first

hike in the Reserve Bank of Australia's cash rate in this cycle, economists at

National Australia Bank think there is a chance that the timing may be delayed

further. In a note published Wednesday, NAB's chief economist Alan Oster is

pointing to new downside risks to the outlook from global trade wars and the

local labor market. The increasing potential for trade wars could lower global

growth and reduce Australian prospects, he said. There are also some emerging

signs of softness in the leading indicators on employment growth, he added.

These new risks are in addition to existing concerns about the outlook for

consumption and NAB economists think that even with moderate uptick in wages,

consumption growth may not do much better than 2.5% over the forecast horizon.

On the upside, they now see the probability of new investment from the mining

sector. Overall, NAB sees the balance of risks as neutral "but possibly a touch

to the downside." They are retaining the view that the RBA would start to raise

the cash rate from May 2019 but this is very data dependent and "it would well

be that the timing may be delayed."