Firm population growth creates quandary for the RBA

The minutes of the RBA’s March meeting revealed that the Board has now dropped its tightening bias. However, we suspect it will be a while before the Bank can be confident it has broken the back of inflation. Indeed, with net overseas migration continuing to shatter records, capacity pressures are likely to remain elevated in the near term. Accordingly, we don’t expect the RBA to cut rates before November, making it the last DM central bank to do so.