Reserve Bank of Australia — Board Decision

Decision (Aug 2025)

• Cut 25 bps to 3.60% — third cut in 2025; decision was unanimous.
• Tone: easing continues but on a data-dependent, meeting-by-meeting basis.
• Minutes: due 26 Aug 2025.

Inflation & Outlook

• Trimmed-mean inflation: ~2.5% near midpoint through forecast horizon.
• Headline CPI: above 3% in H2’25 (electricity rebate unwind), then easing back.
• Unemployment: stabilising ~4.3% in 2026–27.
• Wages: easing, stabilising below 3% by late 2026.
• Productivity: assumptions downgraded; GDP growth track revised a little lower.
• Forecasts assume cash rate settles near ~3% over time.

Analyst / Market Views

• Stance: read as dovish — easing with cautious guidance.
• Path: scope for further cuts if CPI and labour data allow.
• Pricing: AUD softened; front-end yields biased lower.

Trader Takeaways

• Dovish bias, but CPI/wages data remain critical.
• Watch: Q3 CPI, WPI, unemployment/vacancies, electricity rebate impact.
• Risks: global trade policy + productivity trends could alter easing path.

Next Meeting

• Sep 23, 2025 — expected hold or further 25 bp cut depending on inflation and wages.