RBA less likely to raise rates twice in 2018 - NAB

According to analysts at NAB, weak wages growth and slow progress reducing unemployment means it is now less likely that the RBA will raise rates twice in 2018.

Key Quotes

“We now see the RBA raising rates only once in late 2018 – with November 2018 as the most likely start date for a gradual RBA rate hiking cycle.”

“By late 2018 growth should be near 3% and the unemployment rate approaching 5%. That, together with increasing tightness in employers’ ability to find suitable labour, may finally see private sector wages start to moderately edge up.”

“Inflation by that time should also be approaching the bottom of the 2-3% target range.”

“That said, much will still depend on the data flow – it is not impossible that the RBA stays on hold for all of 2018 and raises rates in early 2019.”