RBA: Cash rate unchanged, upbeat on the macro side - TDS

Analysts at TDS note that the RBA left the cash rate unchanged at 1.5% and is upbeat on the macro side.

Key Quotes

“(1) ‘Employment growth has been stronger over recent months and has increased in all states’ (2) ‘Residential construction activity remains at a high level … Retail sales have picked up recently; (3) ‘stronger conditions in the labour market should see some lift in wages growth over time.”

“Usual dampener with “slow growth in real wages and high levels of household debt are likely to constrain spending."  AUD appeared to wilt even though not new news “An appreciating exchange rate would be expected to result in a slower pick-up in economic activity and inflation than currently forecast."  Overall, no change to our view that the RBA remains on hold until closer to mid-2018.”