Despite a surprise decision by the Reserve Bank of Canada to cut interest rates this week, the case for a corresponding RBA cut at its next policy meeting on...

Despite a surprise decision by the Reserve Bank of Canada to cut interest rates this week, the case for a corresponding RBA cut at its next policy meeting on Tuesday, February 3 is not especially strong. Our view is based on several factors, the most important of which is that the labour market could already be turning around. The surprise drop in the unemployment rate to 6.1% in December could be an aberration, but it is consistent with a much earlier upturn evident across a range of forward looking labour market indicators over the past year. The Australian dollar is also much more competitive, and further weakness seems unlikely. For more on this, click on the link: (VIEW LINK)