FX.co ★ RBA Defers Rate Cut as Inflation Outlook Unclear: July Minutes

The Reserve Bank of Australia considered a third interest rate cut within four meetings but ultimately chose to maintain the current rates. This decision was in line with its cautious and gradual approach to easing monetary policy, as revealed in the minutes from the July meeting. Although recent economic data mostly matched forecasts, some indicators were stronger than anticipated. The majority of the board members decided to wait for more concrete evidence that inflation would consistently return to the target range before considering further easing measures. Upcoming key data, including a quarterly inflation report and updates on the labor market, will be reviewed before the next meeting. There was a minority who favored a rate cut, due to concerns about the risks stemming from slowing global growth and weak domestic GDP, which could lead to a quicker than expected decline in inflation. The board has also decided to start publishing vote records without attribution and stressed the importance of remaining data-driven to effectively fulfill its dual mandate of ensuring price stability and full employment.