VIEW: NAB have pushed out their exp. "timing....>

RBA: VIEW: NAB have pushed out their exp. "timing of the next RBA rate cut to

Feb '20, where we exp. a further reduction of 25bps to a new low of 0.5%. It is

at this level of the cash rate where the RBA has prev. stated it would outline a

'package' of unconventional policies if further monetary easing is required to

support growth, full employment & the return of inflation to tgt. The RBA Gov.

is speaking on "Unconventional Monetary Policy" on Nov 26th. We think that the

RBA should actually provide a further interest rate cut next month with private

sector growth remaining weak & little evidence to date that prior easing or the

tax rebates has done enough to offset the weakness in the econ. However, for

now, the RBA appears to be in a holding pattern, while it assesses the impact of

prior rate cuts & 'the gentle turning point'. We see an improvement in growth

over time but not to a sufficiently strong rate of growth to prevent the

unemployment rate beginning to rise. Also, the gov't does not seem to be

inclined to provide material fiscal stimulus in the near term, which increases

the need for the RBA to ease (incl. a further rate cut & unconventional policy)

should our forecast of a deteriorating labour mkt materialise."