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of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
RBA
EXECUTIVE SUMMARY
- Continued consumer and business resilience, labour market tightness and wage inflation pressures should mean that the RBA deploys a 50bp hike for the fourth consecutive meeting. Almost all economists look for such a move (23/25 surveyed by Bloomberg), with one looking for a 40bp step and the remaining one looking for a 25bp hike.
- The September meeting may see the final 50bp hike of this tightening cycle, with RBA watchers set to focus on any guidance on the trajectory of future monetary tightening, although the RBA may look to maintain as much optionality as it can.
- Markets are pricing in a more aggressive hiking cycle than economists are expecting, with a 50bp hike near enough fully priced for this month’s meeting, a further 34bp of tightening priced for next month’s decision (assuming a 50bp hike is delivered this time out), an end-’22 cash rate of ~3.30% priced (~150bp from where we are now) and a terminal rate of ~3.85%.
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Fig. 1: ‘Big 4’ RBA Expectations Vs. The Recent Evolution Of The Cash Rate Implied By The OIS Strip
Source: MNI - Market News/Bloomberg
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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