BRENT TECHS: (X5) Gains Considered Corrective

Governor Bullock confirmed that only a 25bp rate cut was discussed and nothing larger and that the vote for 25bp was unanimous. She noted that the forecasts imply that underlying inflation can be sustainably around the target band mid-point with lower rates but the Board will make decisions “meeting by meeting” and remains highly data dependent. She also reiterated that Australia increased rates less than other countries and so may not have to ease as much, suggesting that its easing path is likely to remain “gradual”.

• The Board continues to take things at a “measured pace” and needs to continue to assess how to maintain that by focussing on the data/information and if it changes the balance of risks. It was right to be on hold in July and wait for data to confirm they were “on track”.
• Bullock emphasised that there has been 75bp of easing, the unemployment rate is historically low and inflation is returning to the band mid-point, which is all good news. Thus, rates are not currently too high. The market path assumed has around another 75bp of easing.
• Bullock was again asked about where “neutral” is and she reiterated that RBA estimates are between 1% and 4%, which is not particularly useful. The Board focuses on whether the data is signalling that it is on track to achieve its forecast path or whether it needs to consider doing something different.
• She noted that the global outlook remains “unpredictable” and the bank is expecting a slowdown in global growth over 2025 and into 2026.
• There were constant questions about productivity and Bullock reiterated that the RBA cannot impact it. She said that her presentation to the productivity round table next week will focus on how reforms that increase productivity growth will improve the economy’s resilience. 

From the ONS: "RTI payrolled employees decreased by 26,000 between May and June 2025"

This is an upward revision from -41k flash. Seems broadly in line with the range of revision estimates we had seen ahead of the release.

At first glance, private sector regular pay looks in line with expectations at 4.8% Y/Y.

Unemployment rate at 4.7% is in line with Bloomberg consensus, but the analyst previews MNI had seen had suggested some upside risks.

PAYE payrolls monthly change smaller than expected, but still waiting on the revision to last months data.

Some modest sterling strength seen post release, with EURGBP falling 0.1% or so. Initial glance of the data doesn't seem enough to meaningfully shift the outlook following last weeks BOE meeting. More to follow.