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RBA Terminal Rate Expectations Lower, Easing Expectations For Late 2024 Firm

STIR

Market RBA expectations have softened noticeably for the second half of 2024. The table below presents updated OIS levels for today against late Sydney levels post yesterday's RBA rate hike.

  • We are slightly firmer for Feb/Mar next year, but rate hike pricing is sub 40% for this period. Terminal rate hike pricing is around 10bps lower compared with end October levels.
  • Market RBA easing expectations grow towards the end of 2024/early 2025.
Figure 1: RBA-Dated OIS Today & Post-RBA
Today (%)Post RBA (%)Change (%)
Dec-234.354.330.03
Feb-244.424.360.06
Mar-244.434.410.02
May-244.464.440.01
Jun-244.434.48-0.05
Aug-244.404.47-0.07
Sep-244.384.46-0.09
Nov-244.324.43-0.11
Dec-244.284.40-0.12
Source: Bloomberg / MNI - Market News

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