Greg Jericho
Chief economist

“Today’s decision does not imply that further rate cuts along the lines suggested by the market are coming. We removed to cautionary increase we put in 2023 to a level that’s still restrictive. The board needs more evidence that inflation is continuing to decline before making decisions about the future path of interest rates.”

That she keeps saying it is restrictive means it is very unlikely  that this will be the only cut – otherwise she is saying the economy needs to keep been slowed, and well, no one of their estimates for the next 2 years suggest the economy is going too fast.

Finally. The RBA has cut rates by 25 basis points, to 4.1%. "It should have happened last year, but thankfully the RBA has finally caught up with reality and delivered a real cost of living benefit for households."@grogsgamut.bsky.social #auspol

— The Australia Institute (@australiainstitute.org.au) 2025-02-18T03:33:56.338Z

In November the RBA was estimating GDP growth in 2024 would be 1.5%, now they think it will be just 1.1%, and whereas by the middle of the year the RBA previously was thinking the economy would be growing at a still bloody weak 2.3%, now it think it will be an even more pathetic 2.0%. Pretty much if that is their outlook there is no way they could not have kept rate high.

Weirdly though the RBA now thinks unemployment will only peak at 4.2% rather than the 4.5% it thought it would get to.

The other big difference is that whereas in November the RBA did not think underlying inflation would only get below 3% near the end of this year, now it thinks it will get there by June.