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Central Banks

RBA Set for One Last Outsized Hike Before Lowe Slows Tightening

  • Most economists, traders see one more half-point hike Tuesday
  • CBA, AMP dissent as Lowe signaled plans for policy downshift
Philip Lowe

Philip Lowe

Photographer: Brent Lewin/Bloomberg

Australia’s central bank is trying to tame inflation without choking off economic growth, bringing economists and traders together in expecting just one more outsized interest-rate increase at Tuesday’s policy meeting.

Most economists surveyed by Bloomberg see a fifth straight half percentage-point hike by the Reserve Bank on Oct. 4 to take the cash rate to 2.85%, before opting for smaller hikes going ahead. Money markets have a similar base case. That’s the latest take on recent signals from Governor Philip Lowe that he is keen to downshift to quarter-point moves at some point.