UBS forecasts a November RBA interest rate hike, and likely more to come after that

UBS response to Wednesday’s upside surprise in Australian inflation data, its Australian economist forecasts a 25bp Reserve Bank of Australia cash rate hike at its November 7 meeting:

  • “RBA Governor Bullock’s speech last night effectively specified they ‘will not hesitate to raise the cash rate further’ – implying a hike of 25bp at their November meeting – ‘if there is a material upward revision to the outlook for inflation’”
  • “UBS has for several months highlighted the material risk the RBA could hike rates in November, particularly if CPI was higher than expected. Well, that’s the case now.

Added that the RBA, like many other DM central banks will keep the cash rate higher for longer.

Says a February 2024 is likely.

The cash rate will go to 4.35% at the November 7 meeting.

ps. Bullock speaks today:

The CPI data and responses ICYMI:

This article was written by Eamonn Sheridan at Source