Markets have priced in a 95% chance the RBA board lifts the cash rate to 4.60% at its September 29 meeting, with rates seen peaking at 4.85% by early next year. For oil, the comments underline how energy costs are now flowing directly into Australian rate expectations, with higher pump and freight costs cited as a specific channel pushing inflation above target.
Markets have priced in a 95% chance the RBA board lifts the cash rate to 4.60% at its September 29 meeting, with rates seen peaking at 4.85% by early next year.
For oil, the comments underline how energy costs are now flowing directly into Australian rate expectations, with higher pump and freight costs cited as a specific channel pushing inflation above target.
The Australian dollar and rate sensitive assets are likely to stay guided by confirmation of this hawkish tone in Bullock's press conference after the decision.
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Markets have priced in a 95% chance the RBA board lifts the cash rate to 4.60% at its September 29 meeting, with rates seen peaking at 4.85% by early next year. For oil, the comments underline how energy costs are now flowing directly into Australian rate expectations, with higher pump and freight costs cited as a specific channel pushing inflation above target. The Australian dollar and rate sensitive assets are likely to stay guided by confirmation of this hawkish tone in Bullock's press conference after the decision.
Summary: RBA Assistant Governor (Economic) Sarah Hunter said on a 9Now podcast, recorded September 7 and published September 22, that the Bank's board is concerned inflation has stayed too high for too long and risks becoming embedded in price setting behaviour.
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