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RBA's Debelle: The Outlook For The Australian Economy speech's headlines

 RBA's Debelle has been hitting the wires with a speech on the outlook for the Australian economy.

Key Quotes:

If the Australian economy continues to evolve as expected, higher rates likely at some point

  • Board view is holding cash rate steady would help reduce unemployment, increase inflation over time.
  • Central forecast for Australian economy to grow a little faster in 2018, 2019 than last year.
  • Important uncertainty relates to household balance sheets.
  • Had been concerned our forecast may have been little optimistic, but now more confident in it.
  • data suggests wage growth has troughed.
  • Sees signs of wage pressures emerging but they remain localised for now.
  • See risks it may take lower unemployment rate than we currently expect to generate wage pressures.
  • Sees slower credit growth due to tighter bank lending standards, sees no implication for consumption outlook.
  • Effect of higher money market rates "Not been that large" for banks to date.
  • Higher money market rates not a "Consequential development" from a forecasting point of view.
  • Money market rates have declined noticeably in last couple weeks, will continue to monitor.
  • Global growth good, but no economy growing much above trend.
  • Headwinds for global growth have abated, not clear they have yet switched to be tailwinds.
  • Current tensions around trade policy a "Significant risk" to global economy.

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