Part 4/7:
The correlation between US economic indicators and Australian monetary policy is instinctive for investors. As the US grapples with employment softness and tariff-related uncertainties, Australia may feel compelled to adjust its interest rates in a bid to cushion possible fallout, particularly if it leads to softer employment or economic growth domestically.
Domestic Policy Considerations and External Influences
The debate about when and how the RBA will act is nuanced. The previous delay in July was partly attributed to concerns surrounding inflation, which had appeared manageable at the time. However, rising global tensions, such as tariff disputes and their associated inflationary pressures, have complicated the outlook.