Separate report on Current Account showed that seasonally adjusted current account deficit rose $3,011 million to $14,024 million in the December quarter 2017. In seasonally adjusted terms, the balance on goods and services deficit in the December quarter 2017 was $117 million, a turnaround of $2,094 million from a surplus of $1,977 million in the September quarter 2017. Imports of goods and services rose $1,953 million and exports of goods and services fell $140 million. The net primary income deficit widened $899m in the December quarter 2017.
However, the focus of the session was on RBA interest rate decision and the following statement. The Reserve Bank of Australia has left the cash rate at a record-low 1.5 per cent, as sluggish wage growth and inflation put the board in a holding pattern for the 17th meeting in a row. Reserve Bank governor Philip Lowe used the word "gradual" to describe Australia's economic recovery three times in his short statement on monetary policy on Tuesday, indicating the bank is in no rush to raise interest rates from their historic lows. "The low level of interest rates is continuing to support the Australian economy. "Further progress in reducing unemployment and having inflation return to target is expected, although this progress is likely to be gradual."
Tomorrow's session will bring Australian GDP figures. Analysts predict 0.5% increase in Q3. In the US session ADP job figures will be published. Incline by 194,000 is anticipated.
Figures to watch:
GDP (Wednesday 1:30)
ADP Non-Farm Employment Change (Wednesday 14:15)