The board also hinted at alternative monetary policy stimulus such as quantitative easing.

"Members recognised, however, that lower interest rates were not the only policy option available to assist in lowering the rate of unemployment, consistent with the medium-term inflation target."

Overall the focus on the unemployment rate – currently sitting at 5.2 per cent – was again presented as the key data point for the bank's monetary policy directive.

"Members agreed that, in assessing whether further monetary easing was appropriate, developments in the labour market would be particularly important."

The Reserve Bank said it decided on June 4 to cut the official interest rate by 0.25 percentage points in order to support employment growth and provide greater confidence that inflation would be consistent with the medium-term target.

"It will assist with faster progress in reducing unemployment and achieve more assured progress towards the inflation target," the RBA board statement said on the day of cutting.

On Tuesday the Australian Chamber-Westpac survey showed that double the number of businesses expected general business conditions to improve over the next six months following the federal election and the June rate cut, but expectations on employment held steady.


The bank also revealed last week that the rate of unemployment needed to see a substantial pick-up in wage growth was now about 4.5 per cent – much lower than the bank's previous 5 per cent estimate.

RBA governor Philip Lowe suggested that a further easing bias to 1 per cent was the only way the bank could achieve employment growth and inflation targets.

Economists at Commonwealth Bank, Citi and JPMorgan said that while the bank provided a more explicit easing bias than what was delivered in the policy statement, it was still not enough to move their expectation of a 0.25 percentage point rate cut in August.

"The minutes don’t advance the case for when the next cash rate reduction is likely to be made. We keep our existing view that the next likely date for a cash rate cut is August, with July the outside chance," Citi's Josh Williamson said.

"The July meeting is clearly live, but we marginally favour August for the next 25bp cut because it coincides with the Statement on Monetary Policy," Commonwealth Bank's Gareth Aird said.