RBA minutes: Further AUD depreciation seems both likely and necessary

Two main messages out of the RBA minutes this morning. Firstly, AUD seems likely to go lower, “Although the exchange rate against the US dollar was close to levels last seen in 2009, the decline in the Australian dollar had been more modest in terms of a basket of currencies. Members noted that the exchange rate had thus far offered less assistance than would normally be expected in achieving balanced growth in the economy and that further depreciation seemed both likely and necessary.” Secondly, low population growth is explaining how the unemployment rate is remaining stable with below average growth in output. “Members observed that the lower-than-expected growth in the population helped to reconcile the below-average growth in output over the past year with a broadly steady unemployment rate.” Copy of the minutes available here (VIEW LINK)