The market has been expecting the Reserve Bank of Australia (RBA) to give more relief by throwing in more interest rate cuts. But the assistant governor of RBA has said the Reserve Bank is focusing on the US policy settings led by the Trump administration.
The RBA after delivering the first rate cut in February 2025 is now set to wait and sit tight in its 1 April 2025 board meeting. The positioning and sentiment of the market shows a high chance that the rate cut might be delivered in RBAs policy meeting on 20 May 2025.
The RBA assistant governor said the board makes its decisions always in an uncertain environment which involves lot of risks thus the board has to think how it can distribute the risks around the central forecast.
The market is very aware that the Trump administration is making lots of policy changes related to trade and tariffs thus the board is waiting to see the impact of these policy decisions on a global scale and how they will impact the inflation in Australia.
It is highly anticipated that the demand will surpass housing supply in all sectors of established homes, home and land packages, rentals etc coupled with very low levels of stock coming to the market.
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