Highlights
The Reserve Bank of Australia has published the minutes of its February 18 meeting. Officials at that meeting lowered their main policy rate, the cash rate, by 25 basis points from 4.35 percent to 4.10 percent.
Consistent with the statement accompanying the decision, the minutes note that recent CPI data showed a welcome decline in underlying inflation to within the target range of two percent to three percent. Officials judge that inflation was expected to be"a little lower in the near term" than had been forecast in November, but they noted that they expect it to remain above the midpoint of the target range if the cash rate were changed in line with market expectations.
Reflecting these factors, the minutes show that officials concluded that conditions warranted a reduction in policy rates at this meeting. But they also carefully considered the risk that easing policy too soon could add to inflationary pressures and they stressed that their decision to cut rates at this meeting"did not commit them to further reductions in the cash rate target at subsequent meetings". This suggest that officials will remain wary about easing policy further until they become more confident about the inflation outlook.
Consistent with the statement accompanying the decision, the minutes note that recent CPI data showed a welcome decline in underlying inflation to within the target range of two percent to three percent. Officials judge that inflation was expected to be"a little lower in the near term" than had been forecast in November, but they noted that they expect it to remain above the midpoint of the target range if the cash rate were changed in line with market expectations.
Reflecting these factors, the minutes show that officials concluded that conditions warranted a reduction in policy rates at this meeting. But they also carefully considered the risk that easing policy too soon could add to inflationary pressures and they stressed that their decision to cut rates at this meeting"did not commit them to further reductions in the cash rate target at subsequent meetings". This suggest that officials will remain wary about easing policy further until they become more confident about the inflation outlook.
Definition
The Reserve Bank of Australia (RBA) publishes minutes of its meetings with a two week lag. The text expands on the statement published two weeks earlier at the time of the announcement.
Description
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.
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.
