Punchline: The Reserve Bank of Australia surprised markets by holding rates steady in July, but the decision seems more understandable in hindsight given the limited CPI data available at the time.
Thank you — that’s good to know. But one has to be very careful with these models — they can be widely misleading and are no substitute for a proper analysis.
Your simple model yields an estimate very close to current futures-market implied probabilities. This was my take on the RBA's July Monetary Policy Board meeting https://stephenkirchner.substack.com/p/when-virtue-is-its-own-reward-the
Thank you — that’s good to know. But one has to be very careful with these models — they can be widely misleading and are no substitute for a proper analysis.