RBA to now hike rates by 25bps in Q3 2020 – Goldman Sachs

In their latest client note, Goldman Sachs’ analysts expressed their take on the Australian economy and the Reserve Bank of Australia’s (RBA) future monetary policy path, in the wake of the recent weakness in the fundamentals.

Key Quotes:

“Outlook for the Australian economy and interest rates has become less certain, against the backdrop of global growth jitters, weakening business surveys and falling house prices.

First half of 2019 is the key risk period for the Australian economy

Most likely scenario:

Economy navigates a key risk period over 1H 2019.

Interest rates edge higher over the medium term.

Somewhat later than we previously forecast …. +25bp in Q3 of 2020 vs. +25bp hike forecasted previously in Q4 2019.”