Reserve Bank of Australia minutes for the meeting on May 2

  • Judged steady rates consistent with achieving sustainable growth and inflation target
  • Developments in labour and housing markets warrant "careful monitoring"
  • Housing credit growth continue to outpace income rise, suggesting higher risks associated with household balance sheets
  • Low wage growth, strong retail competition continue to have "dampening effect" on aggregate inflation
  • March qtr inflation increased confidence in forecasts that core inflation would pick up to around 2 pct by early 2018
  • Higher tobacco excise expected to continue adding to headline inflation
  • Seeing signs of stronger price pressures in non-tradables inflation such as dwelling construction, utilities
  • Utilities prices likely to increase in next few qtrs, could see second-round effects on cpi through upward pressure on business costs
  • Growth in housing prices had remained brisk in sydney, melbourne; slow in perth
  • RBA minutes repeats a rise in A$ would complicate economic adjustment
  • Recent data suggests economy expanded at a "moderate pace" in march quarter
  • GDP still expected to pick up to be a little above 3 pct by H1 2018 as drag from mining investment wane, resources exports pick up
  • Forward looking indicators of labour demand indicated employment growth would pick up a little
  • "Significant uncertainty" about how to measure degree of spare capacity, given high levels of underemployment in recent years
  • Members had in-depth discussion about changes in the composition of employment in recent decades
  • Distinction between full-time, part-time work had become less important in assessing labour market conditions
  • Outlook for chinese economy was an ongoing source of uncertainty for australian exports, terms of trade

Quick Headlines via Reuters

Full text: Minutes of the May 2017 Monetary Policy Meeting of the Reserve Bank Board

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There is little of surprise in the minutes, little departure from the Statement that accompanied the May 'on hold' interest decision nor from the quarterly Statement on Monetary Policy that followed later in the week of the meeting.

More on the May meeting here

  • And it was followed a few days later by the quarterly Statement on Monetary Policy

AUD/USD is little changed, edging a few points higher: