Minutes of the December 4 RBA meeting maintained the same tone that “the next move in the cash rate was more likely to be an increase than a decrease”. But at the same time “there was no strong case for a near-term adjustment in monetary policy”.

For RBA, the “central scenario remained for steady growth in consumption, supported by continued strength in labour market conditions and a gradual pick-up in wages growth”. Also, “further falls in the unemployment rate were likely”. But it should be emphasized that was based on “expectation that the economy would continue to grow above trend”.

Also, the meeting took place before release of Q3 GDP, which showed merely 2.8%. That’s clearly lower than RBA’s own projection of 2.0%. And 2.8% could merely be described as being around trend, not above trend. Thus there is prospect of a dovish shift in RBA’s upcoming forecast in February Monetary Policy Statement.

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Full RBA minutes here.

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