📝RBA November Hike Is Base Case: Westpac

The RBA decision was unanimous, suggesting that any qualms external MPB members might have had about the RBA’s downbeat view of supply capacity were overruled by resurgent oil prices and the stronger than forecast CPI and GDP data.

The bar for a follow-up hike in November is low. Indeed, judging by today’s rhetoric, a November hike is now the base case, absent a lasting resolution of the Middle East conflict beforehand, or some other event that significantly lowers the outlook for energy-related costs in Australia. The bar for hikes beyond that is much higher, given the cumulative rise in interest rates, and noting that the labour market is easing and the housing market will likely weaken further. - Westpac