RBA July meeting minutes – says there was a strong case for raising the cash rate

<p>Reserve Bank of Australia</p><ul><li>
Board considered holding rates steady or hiking by 25 bps</li><li>Strong case for
both, but board judged arguments for holding steady were stronger</li><li>Board agreed some
further tightening may be required, would reconsider at August
meeting</li><li>Current stance of
monetary policy was "clearly restrictive", and would become
more so</li><li>Board discussed
risks economy, consumption could slow more than expected</li><li>Noted squeeze on
household finances, risk unemployment could rise more than needed</li><li>Board noted inverted
yield curve pointed to tighter conditions, slowing growth</li><li>Also risks with
waiting too long for inflation to return to target</li><li>Inflation proving
sticky in other countries, Australian rates still lower than many
others</li><li>Labour market very
tight, weak productivity adding to labour costs</li><li>While domestic
inflation had eased, service inflation still high along with rents,
energy, food</li><li>Annual wage growth
seen rising to 4% in q3, following fair work award</li><li>Economy had slowed
considerably, q2 GDP growth seen around +0.2% q/q</li><li>Consumer spending
seen weak in q2, rebound in housing market to support consumption</li></ul><p>Bolding above is mine. The August 1 RBA meeting is live. </p><p>Full text:</p><ul><li><a href="https://www.rba.gov.au/monetary-policy/rba-board-minutes/2023/2023-07-04.html" target="_blank" rel="nofollow">Minutes of the July 2023 Monetary Policy Meeting of the Reserve Bank Board</a></li></ul><p>AUD/USD had a pop on the lead up to and after the release:</p>

This article was written by Eamonn Sheridan at www.forexlive.com.