Philip Lowe

The Reserve Bank didn't cut rates yesterday -- enabling the Morrison government to dodge a bullet -- but it has laid down, fairly clearly, that it is going to cut rates unless unemployment falls. The last paragraph of yesterday's statement from Governor Philip Lowe is clear: the bank would leave rates on hold, but:

In doing so, [the board] recognised that there was still spare capacity in the economy and that a further improvement in the labour market was likely to be needed for inflation to be consistent with the target. Given this assessment, the Board will be paying close attention to developments in the labour market at its upcoming meetings.