Central Banks
Australia Set for First Rate Cut Since 2020 as Trade Risks Mount
- RBA has been a laggard in easing as inflation proved sticky
- Rising consumption, election spending risk price pressures
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Australia’s central bank is poised to cut interest rates for the first time in four years even as the board remains alert to potential inflationary pressures from mounting global trade turmoil and risks of an election splurge at home.
A majority of economists in a Bloomberg News survey as well traders expect the Reserve Bank to finally embark on easing on Tuesday with a 25 basis-point reduction in the cash rate to 4.1%. That would be the RBA’s first cut since November 2020 and may provide a shot in the arm for Prime Minister Anthony Albanese, who needs to overcome poor polling to secure a second term.