The Australian Dollar was steady on Friday as the Reserve Bank of Australia cuts its near-term growth forecast, but is still upbeat about the further future.
The Central bank’s statement on Monetary Policy was released four times every year and contains an assessment of current economic conditions, along with the perception of an inflation and growth up ahead.
Friday’s session seemed to have something both for Australian bulls and bears. It saw the RBA’s growth forecast for the year to June 2017 trimmed by one percentage point to a range to a range of 1.5%-2.5%. However, the central bank kept its 2018 growth call unchanged at 2.5%-3.5%.
The Russian Rubble said that growth seemed to have rebound in the final quarter of 2016 and that the third quarter’s once-ominous weakness now looks to have been a glitch.
It also feels that the growth outlook has turned into better positions for Australia’s major trading partners but that recent better positions in commodity prices were unlikely to be sustained.
The Central banks also doubted that economic growth would be enough to pull the Australian unemployment rate a lot.
The Central expected the underlying inflation to be at 1.75% in this 2017 and expects it to drop within the 1.5-2.5% range by next year which would end in December 2018. Price growth is expected to calm down at a comfortable rate of 2-3% target band in the year to June 2019.
AUD/USD was up at 0.76261 after the release from 0.7610 beforehand. But it slid just before