RBA announces their latest monetary policy decision – 2 June 2020
- Prior 0.25%
- 3-year government bond target maintained at 0.25%
- RBA prepared to scale up bond purchases if necessary
- Won’t raise cash rate until progress is made towards full employment, inflation target
- Accommodative approach to be maintained for as long as it is required
- Market operations supporting a high level of liquidity
- Economy is experiencing a severe downturn
- Household spending weakened very considerably
- It is possible the downturn depth will be less than earlier expected
- Sees continued improvement in financial markets
The language in bold is new but I don’t think it makes much of a difference – at least not now. Their forward guidance on the cash rate and yields target remains unchanged, so that says a lot more that this decision is more of a non-event if anything else.
The other thing to take note of is that they did not make mention of the relative strength of the aussie since its last meeting back in May.
The aussie has gained by over 5% against the dollar in the past month and may be on its way towards 0.7000 so that may provide some relative comfort for buyers.
Other than that, there’s nothing much to see from the decision here. AUD/USD is little changed on the session at around 0.6790 currently.