Economists react
Bill Evans
For us by far the most significant aspect of the [RBA's] statement was the decision to move back to a neutral bias from the consistent easing bias that we have seen in recent statements.
Deutsche Bank chief economist Adam Boyton
The lack of any "forward guidance" in the final paragraph has us concluding the statement is a little less dovish than the market might have been expecting ... The case for the next rate cut - should there be one - needs to be built from scratch.
ANZ chief economist for Australia Ivan Colhoun
It's an evolution of recent thinking rather than a revolution. Therefore I think their statement on monetary policy on Friday will be very closely watched by the market because it will give more information about what they're thinking about the outlook for growth and perhaps the outlook for unemployment.
Barclays chief economist Kieran Davies
We are surprised that the RBA did not repeat the easing bias, as it would have placed some additional downward pressure on the exchange rate.
HSBC chief economist for Australia Paul Bloxham
We are of the view that today's cut could be the last for this easing phase, as the lower Australian dollar is doing a lot of the work for the RBA already and is also an upside risk to the inflation outlook.
UBS chief economist Scott Haslem
Firstly, there was no forward guidance. Little should be read into this, as it's relatively standard practice to provide minimal guidance on a cut, as was the case when they last cut in May ... We think the RBA is now on hold here for several months, being in data-watching mode.
RBS senior currency strategist Greg Gibbs
The risk is that [the Australian dollar] continues to squeeze up as the market unwinds the risk of further near-term cuts. The RBA is back in watch-and-wait mode. They would like to keep the Australian dollar low, but probably understand that cutting rates too quickly, [so] that it projects a bottom is close, will be counterproductive.
Frequently Asked Questions about this Article…
Economists noted the RBA shifted from a consistent 'easing bias' back to a 'neutral bias' — a meaningful change that signals the central bank is less focused on cutting rates and more on watching incoming data. For investors, that can affect borrowing costs, share prices in interest-sensitive sectors, and expectations for future monetary policy moves.
Several economists said the absence of forward guidance makes the statement less dovish than markets may have expected, meaning the 'case' for another rate cut would have to be rebuilt from scratch. In practice this tends to leave markets in a wait-and-see stance until fresh data clarifies the outlook.
Some economists suggested it might be. For example, HSBC observed that a lower Australian dollar is already doing much of the RBA’s work and could push up inflation, so the recent cut could be the last in this easing phase — though this depends on future data.
A neutral bias indicates the RBA is no longer explicitly leaning toward further cuts and is instead monitoring economic indicators more closely. Economists described it as an evolution of thinking — signalling the bank may be on hold for a period while it assesses growth, inflation and unemployment data.
Analysts pointed out that dropping the easing bias could remove downward pressure on the AUD and even allow it to lift if markets unwind expectations of near-term cuts. At the same time, a lower AUD has been helping the RBA by supporting inflation, so currency moves are an important part of the policy picture.
Economists recommended watching key data on economic growth, unemployment and inflation — and the RBA’s upcoming monetary policy statements — since the bank is in a data‑watching mode and will base future decisions on how these indicators evolve.
Most commentators expect the RBA to be on hold for a while, with little forward guidance pointing to immediate additional cuts. Economists described the bank as taking a wait-and-see approach and watching incoming data before moving again.
A weaker AUD can support inflation by making imports more expensive, which the RBA monitors when setting policy, while a stronger AUD can reduce inflationary pressure. For investors, currency swings can materially affect returns — especially for international investments, exporters, importers and companies sensitive to domestic inflation.
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