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Final Thoughts

RBA

The 50bp rate hike delivered today was a bit of a given

  • The reference to a narrow path & the suggestion that the RBA isn't on a pre-set course isn't new information, Lowe has used these phrases previously. But their inclusion in the statement starts to formally embed the concept of optionality re: further normlisation.
  • Debate will now ensue re: the odds of a 50bp hike in September, with OIS currently pricing in ~34bp of tightening ahead for next month's meeting, a little over 5bp below pre-RBA levels. Year-end and terminal rate pricing also sees a marginal moderation.
  • We will flesh this out further in our full review, which will be published later today.
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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