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- April decision was another close call
- "Bottom line" is the board wanted more time to assess how the economy was tracking and responding to the February rate cut ... especially in waiting for the next quarterly inflation data
JPM comment - bolding mine:
- There were two main changes in the official commentary released the day of the April Board meeting, relative to the March commentary, and these were expanded upon in the minutes. The first related to AUD, the second to credit dynamics.
- On the former, there is no explanation as to why the statement dropped the earlier reference to AUD's deviation from fair value, but the most likely conclusion is that the unit's overvaluation had dwindled to all but nothing.
- On credit, there was an acknowledgement that business borrowing had improved, and some constructive thoughts on investor credit, but that's about it.
JPM conclude:
We still believe the RBA's decision to be inactive two weeks ago is just a matter of timing, with the cash rate likely to be lowered again in May, although that decision looms as another close one.
The inevitable information decay of minutes means Governor Stevens' more contemporary speech last night should be favoured as a guide to the latest RBA thinking. As we indicated in our note earlier today, the Governor today reinforced a clear easing bias in his comments, indicating that rate cuts remain on the table
