Central Banks
RBA Watchers Split as Policy Tightening Cycle Is Nearing End
- Of 26 economists surveyed, 15 see hike and 11 predict a hold
- Money markets are pricing no change to the cash rate at 4.1%
A skateboarder outside the Reserve Bank of Australia (RBA) building in Sydney, Australia.
Photographer: Brent Lewin/BloombergThis article is for subscribers only.
Australia’s policy tightening campaign is approaching its final stages, with money markets and economists divided over the timing of the Reserve Bank’s likely last interest-rate increase in this cycle.
Traders expect the RBA will hold its cash rate at 4.1% for a second straight meeting on Tuesday after quarterly inflation eased and retail sales surprisingly fell. In contrast, a majority of economists expect a 25-basis—point hike to ensure a tight labor market doesn’t fuel wages while price gains hover at twice the central bank’s target levels.