Barrenjoey chief economist Jo Masters was one of the few economists who did not expect the Reserve Bank to cut rates in February. She says it is too soon to tell if the central bank made a mistake. But she says it is clear the rate cutting cycle will be slower and longer had the RBA waited to act. Rather than the four rate cuts priced in by the market, Jo Masters says two are more likely this year. She says the strong labour market remains a risk to the RBA’s fight against inflation. Jo Masters says it is too soon to call victory on a soft landing for the Australian economy, which continues to face many risks, not least of which is global uncertainty and possible inflationary pressures of the Trump administration’s policies and tariffs.
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