RBA Shifts to a Neutral Policy Stance

The Reserve Bank of Australia raised its economic growth and inflation forecasts, reflecting a weaker currency, and reiterated its shift to a neutral policy stance.

“Over the past few months, there have been further signs that very stimulatory monetary policy is working to support economic activity,” the RBA said in its quarterly monetary policy statement in Sydney today. “The board’s view is that a period of stability in the policy rate is likely.”

The central bank projected core inflation of 3 percent in the year ended June, half a point higher than seen three months earlier, and 2.25 percent to 3.25 percent through December 2014, a quarter-point increase. It expressed uncertainty over what drove a price pickup last quarter and said it expects inflation to be consistent with its target over the forecast period.

Bloomberg

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.