Forex
Home›Forex›Central Banks›RBA keeps door open for another rate hike if inflation…
RBA keeps door open for another rate hike if inflation stays sticky
Markets now price roughly a 70.0% chance of a 25 basis point hike at the September 29 meeting to 4.60%, after July’s stronger inflation reading.
RBA Assistant Governor Sarah Hunter said the central bank is keeping open the possibility of further tightening, emphasizing that inflation remains the top priority as it weighs the next policy move.
Hunter, speaking at a property conference, said that if inflation appears likely to come in stronger than expected, the RBA board may need to raise interest rates.
She also argued that some deterioration in consumer demand would not necessarily be a reason to stop tightening, saying the RBA wants demand to soften so overall demand better balances with constrained supply.
The remarks came after July’s stronger inflation reading prompted a sharp repricing in markets, which Action Forex reports now assign around a 70.0% probability to a 25bp hike to 4.60% at the September 29 meeting, while Hunter played down recession risk, saying she did not expect a recession or anything like that.