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Prior decision 1.50%
Inflation likely to remain low for some time
Sees inflation picking up gradually as economy strengthens
Unchanged policy consistent with sustainable economic growth
Sees GDP growth average above 3% in 2018, 2019
Progress on unemployment and inflation expected to be gradual
Rising AUD would lead to slower economic pickup
AUD remains in range of past couple of years
One continuing source of uncertainty is outlook for household consumption
Housing markets have slowed in Sydney, Melbourne
Wage growth remains low, likely to continue for a while yet
Rate of wages growth appears troughed
Inflation figures were in line with expectations, expected to be a bit above 2% this year
Global economy has strengthened over the past year
Australia’s terms of trade expected to decline, but remain at high level[b]RBA statement on monetary policy – 4 May 2018
[/b]
Lifts 2018 core inflation forecast to 2% from 1.75%
GDP growth forecast of 3.25% by December 2018, 2019
GDP growth forecast of 3% by mid-2020
If economy improves as expected, higher rates are appropriate
A significant appreciation in AUD would dampen growth and inflation
2018 unemployment rate forecast now at 5.5%, previously 5.25%
Labour market will still have spare capacity by mid-2020
Data implies economy currently growing around 2.75%
Data revisions show more resilient household consumption, sees solid growth for Q1
Economic growth for Q1 looks to have picked up, partly thanks to exports
Significant escalation of trade protectionism could derail global growth
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