RBA minutes: Members discussed leaving rates on hold

The minutes of the May 3rd RBA meeting when interest rates were cut by 25bp to 1.75% have been released.

As Reuters reports, citing the RBA minutes report, "members discussed leaving interest rates on hold at the May 3 meeting but decided on balance that a cut then would help return inflation to target over time."

RBA noted: "Although the March quarter outcome for the CPI reflected some temporary factors, the broad-based softness in prices and labour costs signalled less momentum in domestic inflationary pressures than had previously been expected."

On the Aussie, they noted that a lower A$ since 2013 is assisting the economy, but a rising A$ would complicate this.

Key headlines - Reuters

Members discussed merits of waiting for more information before cutting rates at may 3 meeting

On balance, members were persuaded that a rate cut would help inflation return to target over time

Members noted recent data on inflation and labour costs had been lower than expected

Recent developments had not led to a material change in economic outlook

Very accommodative monetary policy helping economy rebalance following mining boom

Lower a$ since 2013 assisting economy, but a rising a$ would complicate this

Members noted a recent rally in commodity prices was not expected to boost mining investment

Growth outlook for australia's major trading partners had been revised a litle lower since feb

Chinese growth had moderated further in q1, more stimulatory policy should provide support