Statement on Monetary Policy August 2025

Contents

• In Brief
• Overview
• 1. Financial Conditions
  • Summary
  • 1.1 Interest rate markets
  • 1.2 Corporate funding markets
  • 1.3 Foreign exchange markets
  • 1.4 Australian banks and credit markets
• 2. Economic Conditions
  • Summary
  • 2.1 Global economic conditions
  • 2.2 Domestic economic activity
  • 2.3 Labour market and wages
  • 2.4 Assessment of spare capacity
  • 2.5 Inflation
• Box A: How are Global Trading Patterns Adjusting to Changes in Trade Policy, and What Does It Mean for Australia?
• Box B: Insights from Liaison
• 3. Outlook
  • Summary
  • 3.1 Key judgements
  • 3.2 The global outlook
  • 3.3 The domestic outlook
  • 3.4 Key risks to the outlook
  • 3.5 Detailed forecast information
• 4. In Depth – Drivers and Implications of Lower Productivity Growth
  • Summary
  • 4.1 Why productivity growth matters
  • 4.2 Productivity growth has slowed in Australia (and many other advanced economies)
  • 4.3 We are downgrading our productivity growth assumption
  • 4.4 Implications of the downgrade for our forecasts and assessment of spare capacity

The cut-off for data used to prepare the forecasts for the Statement on Monetary Policy was 6 August 2025.

Some graphs in this publication were generated using Mathematica.

ISSN 1448–5141