Few things to stir the RBA from a stable rate point of view | Liverpool City Champion
Economists expect the Reserve Bank to stick to its prospect of keeping the cash rate at an all-time high until 2024, when its board of directors will meet on Tuesday.
Recent data has shown a sharp drop in employment due to lockdowns in NSW, Victoria and ACT, and continued weakness in retail spending, a key driver of economic growth.
RBA Governor Philip Lowe estimated that the impact of the restrictions will have seen the economy contract by at least 2% in the September quarter.
But at the same time, vaccination rates are improving rapidly, and lockdown states have laid out their plans to reopen, suggesting an economic recovery will begin in the December quarter.
Economists will look for clues in Dr Lowe’s statement after the meeting on when restrictions on home loans could be introduced to ease some of the heat in the Australian housing market.
The Board of Financial Regulators, of which the RBA is a member, warned last week that while lending standards have not come down so far, they are considering policies to curb activity before indebted households become a risk to the economy.
Plenty of economic data is expected as RBA members gather for their monthly meeting on Tuesday.
The ANZ-Roy Morgan weekly consumer confidence survey is expected, an indicator of future household spending.
Confidence has held up fairly well in the face of lockdowns, suggesting spending will rebound once COVID-19 restrictions ease.
ANZ will also release its monthly job posting series for September, which has weakened in the previous two months due to lockdowns.
Other measures of job vacancy, which provide a guide to future employment, have also weakened in recent months.
The Australian Bureau of Statistics will release its international trade figures for August.
Economists are forecasting a smaller trade surplus of $ 10 billion, narrowing from the record high of $ 12.1 billion recorded in July.
This probably reflects the impact of a 25 percent drop in the price of iron ore.
Associated Australian Press