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2026-02-17 14:04:40
Westpac: RBA Underestimates Currency Impact on Inflation, Imports Face Downside Risks. Westpac Chief Economist Luci Ellis stated that the Reserve Bank of Australia's (RBA) policy meeting minutes significantly downplayed the role of currency appreciation in curbing inflation. She pointed out that while the recent appreciation of the Australian dollar largely reflects changes in the interest rate outlook and is expected to have a slight slowing effect on inflation, the sell-off in the US dollar is an independent factor that the RBA seems to have failed to adequately consider. Ellis believes that although this effect will not be immediately apparent, it does indicate some downside risks to import inflation.
