The Reserve Bank of Australia published the minutes from its monetary policy meeting held earlier this month. At that time, the RBA left its interest rate at 2.0 percent. The RBA said that economic data would be a guide to determine if its current policy stance is appropriate. The information would include information both on economic and financial conditions.
The RBA repeated that "information about economic and financial conditions would continue to inform the board's assessment of the outlook and whether the current stance of policy remained appropriate to foster sustainable growth and inflation consistent with the target."
In the minutes, the RBA said it expects domestic inflation to stay contained. International economic developments are increasing the downside risk to the economic outlook but it is too early to assess its impact.
The RBA discussed the depreciation in the yuan and how it was not out of line with short-term movements sometimes seen between the major freely floating currencies. It also noted Chinese authorities had been selling foreign-exchange reserves to prevent depreciation in the face of significant capital outflows and how the effect on asset markets of those outflows could be large, depending on what assets were being bought by those taking capital out of China.
The RBA said weaker demand for commodities from China had resulted in falls in the prices of bulk commodities and base metals over the course of the year to date. In particular, production of many industrial products, including steel, had declined since the previous year but also added that iron ore imports from Australia had continued to increase.
The RBA issues minutes of its meetings with a two week lag.
Although the RBA's Reserve Bank Board issues a detailed statement at the conclusion of its monthly meetings, investors also look to the minutes for a more detailed description of current economic outlook both domestically and abroad along with the latest RBB policy thinking.
It is only recently that the RBA has released meeting minutes. At the conclusion of their December 2007 meeting, the RBA announced several changes to its communications policy. Previously, a statement was released only if a policy change was made. Now a statement is released at the conclusion of every meeting. Another change concerned the timing of the policy announcement. Rather than waiting until the next day, the announcement occurs immediately after the conclusion of the meeting. In addition, minutes are now released two weeks after the meeting.
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