Australian Banks Split on RBA Rate Path as Two See February Hike

Two of Australia’s top lenders expect the Reserve Bank to raise interest rates in February to counter stubborn price pressures, while a third sees a prolonged pause, underlining growing uncertainty over the trajectory of inflation.

Commonwealth Bank of Australia on Tuesday said it now expects one rate rise next year to 3.85%, though economist Belinda Allen sees the risk of a “larger hiking cycle if growth has more momentum” and inflation is more persistent. National Australia Bank Ltd. Chief Economist Sally Auld expects two hikes — in February and May — for a terminal rate of 4.1%.