Nicki points out that the RBA will continue to have eye out for frothy market conditions:
“As part of the government reinstating the RBA governor’s terms they didn’t charge the 2-3 per cent inflation target but they did say there needed to be a more transparent link between monetary policy and financial market stability.
“So that is obviously a note to the RBA not to consider risks or bubbles in the asset prices when targeting inflation.
“I am not particularly worried, I know there are comments around Chinese investment.
“But at this stage it appears to be a small risk. The risks on housing are very much skewed to the negative side.
“If you are talking about property market prices, you will see some pull back in Sydney and Melbourne because there are so many apartments.