Minutes of August RBA meeting noted that drought conditions affected the timing of crop harvest. And the “probability of an El Niño event, which would typically be associated with low rainfall in eastern Australia, had increased over 2018″. That implies ” downside risks to the forecasts for farm output and exports.”
Otherwise, the minutes came in basically as expected. They noted that global economic expansion continued but “direction of international trade policy in the United States continued to be a source of uncertainty for the global outlook.”
Australian Dollar had “depreciated a little” against the US dollar. However, “in trade-weighted terms it had remained within its trading range of the previous two years.”
Domestic forecasts were largely unchanged. GDP is projected to be a little above 3% over 2018 and 2019. Inflation would dip “temporarily” in September quarter due to some administered prices. But it’s expected to be at around 2.25% in 2020.
On interest rates, the next move “would more likely be an increase than a decrease”. But there was “no strong case for a near-term adjustment”.
