Quick thoughts on RBA – a bit more optimistic on investment and labour

The RBA statement is pretty close the previous one, but they have signaled some improvement in the outlook for non-mining investment, and the labour market.

They said, “The outlook for non-mining investment has improved recently and reported business conditions are at a high level.”

This sounds more confident than the previous statement that said, “Business conditions have improved and capacity utilisation has increased. Some pick-up in non-mining business investment is expected.”

On the labour market they said, “The various forward-looking indicators point to solid growth in employment over the period ahead.”

An upgrade from the previous statement that said, “The various forward-looking indicators point to continued growth in employment over the period ahead.”

However, despite shifting the wording from “Continued growth” to “solid growth”, they still concluded that, “The unemployment rate is expected to decline a little over the next couple of years”

The comment on wages might be seen as a bit more optimistic.  They continued to say, wages growth is low and this is likely to continue for a while yet.  However, they added that, “Stronger conditions in the labour market should see some lift in wages growth over time”.  Again giving a bit more weight to recent strength in the labour market.

On the housing market, the commentary is similar, although they single out “Sydney” for the first time.  They said, “Housing prices have been rising briskly in some markets, although there are signs that conditions are easing, especially in Sydney.”

The comment on the exchange rate, the global economy and the final policy assessment were essentially unchanged.

September 5 RBA statement

August 1 RBA Statement



Disclosure and Certification

  • The author of this report often has positions in the currencies and securities referenced in the report at the time of publication, or plans to trade in these currencies and securities.
  • The views expressed in this report accurately reflect the author’s personal opinion about the referenced currencies and securities referenced and other subject matter.
  • The report does not contain and is not based on any non-public, material information.
  • The information in this report has been obtained from sources we believe to be reputable and accurate, but we have not independently checked or verified that information.
  • This report is protected by copyright laws. Please do not republish, post or distribute in any way its contents without prior permission from our company.
  • Our Company is incorporated and licensed in Australia to provide only general financial advice. Please see our financial services guide and terms and conditions for use of this report for more information.

Greg Gibbs,
Founder, Analyst and PM
Amplifying Global FX Capital Pty Ltd