Bullish ASX investors shouldn’t ignore RBA warning

The Reserve Bank’s Statement of Monetary Policy, released as the RBA cut rates by 0.25 per cent to 3.85 per cent, the lowest level since May 2023, contains the word “uncertain” 134 times.

At her post-decision press conference on Tuesday afternoon, governor Michele Bullock went further, explaining that the environment was not just uncertain but also unpredictable; scenarios released on Tuesday suggest everything from a relatively benign outcome of a modest decline in global growth that puts downward pressure on both GDP growth and inflation (the central bank’s base case) to a trade war scenario that smacks growth and causes deflation, to a trade peace scenario which is positive for growth, but also reignites inflation concerns.

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