Reserve Bank of Australia's Governor Philip Lowe is speaking on "The Year Ahead" at the National Press Club, Sydney today.
Markets are looking for further clarification since the RBS's rate decision yesterday and surprise optimism about the economic outlook which lifted AUD crosses through stops, triggering a huge bid in the Aussie.
Lowe said on Wednesday that Australia's central bank would see a strong case for cutting its benchmark interest rate from current record lows if the unemployment rate moved higher and there was no progress in lifting inflation. However, the RBA says that the economy is still passing through “gentle turning point” for the better.
Casting minds back, the unemployment rate eased to 5.1% in December while the latest data showed inflation had ticked higher, implying there was no urgency to lower rates and the central bank subsequently left its cash rate at 0.75% at its first meeting of the year on Tuesday in what was a rather surprisingly upbeat assessment of the economic outlook.
Source : Fxstreet