Reserve Bank of Australia Governor Lowe, speaking at an event in Thailand:
- inflation expectations in remain well anchored
- household spending in Australia has been resilient to the higher interest rates so far
- in this cycle policy lags are likely to be longer
- the Reserve Bank of Australia is attempting to slow inflation without too much negative impact on the economy
- central banks are going to be confronting much greater variance in inflation rates
- must show members of the public that CPI will come down to target
The Reserve Bank of Australia meet on December 6. a +25bp rate hike is expected. I have seen expectations of a +15bp hike, which will bring the cash rate back to its regular 0, 0.25, 0.5, 0.75 little figures but I am not holding my breath for this.
The current cash rate in Australia is 2.85%. A 15bp hike would bring it to 3.0%.