Low unemployment, resurgent consumer spending and persistently high inflation in the United States could lead Reserve Bank governor Michele Bullock to keep the cash rate on hold despite markets viewing the first post-pandemic rate cut as a near certainty.
That’s the view of some leading economists including Warwick McKibbin, who served on the RBA board from 2001 to 2011 and argues there is not a strong argument in favour of cutting the official cash rate for the first time in more than four years at Tuesday’s eagerly awaited meeting.
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Michael Read is the Financial Review's economics correspondent, reporting from the federal press gallery at Parliament House. He was previously an economist at the Reserve Bank of Australia and at UBS. Connect with Michael on Twitter. Email Michael at michael.read@afr.com
Phillip Coorey is the political editor based in Canberra. He is a two-time winner of the Paul Lyneham award for press gallery excellence. Connect with Phillip on Facebook and Twitter. Email Phillip at pcoorey@afr.com
