The recent dip in unemployment and pick-up in inflation has given the RBA some breathing space, with rates now expected to remain on hold until at least early next year.
The futures market forecast a less than 10 per cent chance of a cut and no longer has a full 25 basis point cut priced in over its 18-month horizon.— particularly in Melbourne and Sydney — has taken some pressure off the RBA to move borrowing costs lower, the economy continues to grow below its long-term trend.
The RBA is forecasting GDP growth of around 2.25 per cent this year, gradually picking up to 3 per cent in 2021. "The main domestic uncertainty continues to be the outlook for consumption, with the sustained period of only modest increases in household disposable income continuing to weigh on consumer spending."
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