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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.
RBA
EXECUTIVE SUMMARY
- The continued tightening of the labour market, level of inflation and expected acceleration in price pressures through year-end means that the RBA will likely lift its cash rate target by 50bp come the end of its August meeting.
- The Bank will release its quarterly SoMP on Friday, with the customary round of hints and reveals due to be presented in the Tuesday statement. The inflation projection profile will garner the most attention, although the Governor has already revealed that the Bank expects inflation to top 7.00% by the end of the year.
- Looking ahead the Bank will likely deploy another 50bp hike in September, which will get it near Lowe’s baseline assessment of neutral. After that, the fact that the RBA meets monthly gives it the opportunity to be nimble, particularly if the likes of the U.S. Fed decide to slow the rate of tightening from September.
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Fig. 1: ‘Big 4’ RBA Expectations Vs. The Cash Rate Implied By the IB Strip
Source: MNI Market News/ASX/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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