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(RPT)MNI RBA WATCH: Hold Likely As Reserve Awaits Fresh Data

(MNI) Melbourne

The RBA board will likely hold the cash rate at 4.35% when it delivers its last decision for 2023.

The Reserve Bank of Australia will consider leaving the cash rate unchanged at 4.35% when it meets on Dec 5 as it awaits fresh data following an easing in the monthly inflation series, despite Governor Michele Bullock’s recent hawkish turn in the fight to pull CPI below the 2-3% target.

While the RBA and Bullock have stressed the higher-for-longer narrative over the past month with the last Statement on Monetary Policy and meeting minutes following November’s hike preparing the market for a least one more increase, CPI ticked lower than expected in October, rising only 4.9% from the prior month’s 5.6%, while trimmed CPI increased 5.1%, down from September’s 5.5%. The RBA typically sees the monthly series as more volatile and will want to analyse another quarterly CPI result due Jan 31 before raising the cash rate again.

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The Reserve Bank of Australia will consider leaving the cash rate unchanged at 4.35% when it meets on Dec 5 as it awaits fresh data following an easing in the monthly inflation series, despite Governor Michele Bullock’s recent hawkish turn in the fight to pull CPI below the 2-3% target.

While the RBA and Bullock have stressed the higher-for-longer narrative over the past month with the last Statement on Monetary Policy and meeting minutes following November’s hike preparing the market for a least one more increase, CPI ticked lower than expected in October, rising only 4.9% from the prior month’s 5.6%, while trimmed CPI increased 5.1%, down from September’s 5.5%. The RBA typically sees the monthly series as more volatile and will want to analyse another quarterly CPI result due Jan 31 before raising the cash rate again.

Keep reading...Show less