SYDNEY, Aug 8 - Australia's central bank is expected to be cautiously optimistic in a statement on Monday, with analysts expecting it to soften its easing bias after promising signs from larger economies. A poll on Friday found expectations for a rate cut have withered after the Reserve Bank of Australia opted not to ease at the past two meetings, leaving rates at 4.75 percent for a 14th month on Tuesday. Of 20 economists surveyed, only six still forecast a rate cut this year. All the rest expected rates to stay on hold until 2004, when six now expect a tightening anywhere from the first- to the fourth-quarter. Double click [AU/ECI] for poll. "The bias to ease is likely to be watered down but we are not sure if it will be removed completely. There remains much uncertainty over the degree of traction and sustainability of the U.S. recovery," said Su-Lin Ong, senior economist at RBC Capital Markets, who forecast an easing in the first half of next year. "It will be consistent with a soft, easing bias. That's not going to be enough for the market -- they will take that very much as rates on hold," she said. Interest-rate futures, which had priced in 75 basis points of easing in 2003, have this week started pricing a 25 basis point tightening by mid 2004 and have no change priced this year. The Reserve Bank said on June 6, the last time it spoke publicly on monetary policy, that it might lower rates if the global economy failed to improve. Since then, GDP growth of 2.4 percent in the United States in the June quarter has sparked optimism that world economic expansion may accelerate -- a change which may be reflected in the Reserve Bank's quarterly statement. "As these documents are written to justify recent policy decisions, it seems likely that the Bank will focus on the brighter signs emerging from the U.S.," said Richard Gibbs, analyst at Macquarie Bank. Some analysts predict the Reserve Bank will drop the easing idea and revert to a neutral stance. A recent decline in the Australian dollar has taken pressure off local exporters, and a surprisingly robust housing sector suggests the Bank may be right to worry about fuelling a property-price bubble if it lowers rates. "We would expect the RBA to move back to a neutral bias due to the improvement in the international outlook and the clear strength still in the housing market," said Stephen Halmarick, economist at Citigroup, who expected rates to be increased 50 basis points in the second half of 2004. Australian housing finance commitments rose 4.1 percent in June and 5.2 percent in May, data on Friday showed. In June, Australia saw its largest monthly jump in private-sector housing approvals since May 2001. Still, almost half of economists polled on Friday continue to predict the next move in rates, when it comes, will be down, noting job losses in recent months and Australia's vulnerability to any downturn in housing or growth hiccups offshore. "I think those who have moved to pencil out any chance of the Reserve Bank of Australia cutting rates might have been a bit premature," said Michael Blythe, chief economist at Commonwealth Bank of Australia. ((Reporting by Miranda Maxwell, editing by Phil Smith; miranda.maxwell@.com; Messaging: For related news, double click on one of the following codes: [M] [T] [E] [D] [AUF] [RNP] [DNP] [PTD] [AU] [ASIA] [DBT] [FRX] [INT] [CEN] [MCE] [REA] [LEN] [RTRS] Friday, 8 August 2003 06:41:06 RTRS [nSYD54321]