Philip Lowe’s first job as RBA Governor has been to emphasise the medium-term nature of the 2-3% inflation target and highlight how the RBA juggles this with its often conflicting objective of financial stability. These tweaks to the RBA’s framework just make official what the RBA has been practising for some time, but the markets will probably still interpret them as a sign that the RBA is unlikely to cut interest rates below 1.5%. We still think low inflation will eventually force rates to be cut to 1.0%.
Become a client to read more
This is premium content that requires an active Capital Economics subscription to view.
Already have an account?
You may already have access to this premium content as part of a paid subscription.
Sign in to read the content in full or get details of how you can access it
Register for free
Sign up for a free account to:
- Unlock additional content
- Register for Capital Economics events
- Receive email updates and economist-curated newsletters
- Request a free trial of our services