The RBA Monetary Policy Board held the cash rate at 3.60% today as widely anticipated.
Markets were positioned for hawkish rhetoric, with around one-and-a-half 25bp cash rate hikes priced in over the next year or so.
Initial reactions in FX and fixed income markets suggest that markets expected more hawkishness than was delivered in the relatively short statement from the Board. (That was changing though as we go to print.)
But, it’s hawkish. No doubt about that.
A key phrase in the Board’s statement is in the first paragraph and reads:
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