A few keener observers than I have noted that the RBA did include some more dovish rhetoric around the dollar in its statement today. The return of the phrase “historically high” is a little shot across the trader’s bows and an implicit acknowledgement that it screwed up royally at the last meeting. The Aussie has weakened and the timing is good given global risk off, which could give the jawbone greater potency:
Here is a list of other minor changes in the statement courtesy of the stenogrphers at the SMH blog. In are:
- Exports are rising
- At this stage, signs of improvement in investment intentions in other sectors are only tentative
- Public spending is scheduled to be subdued
- If domestic costs remain contained, some moderation in the growth of prices for non-traded goods could be expected over time, which should keep inflation consistent with the target, even with lower levels of the exchange rate.
- Dwelling prices have increased significantly over the past year.
- The decline in the exchange rate seen to date will assist in achieving balanced growth in the economy, though the exchange rate remains high by historical standards.
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Out is:
- “expects growth to remain below trend for a time yet”.