Australian interest rates

As reported earlier, Australia’s unemployment rate has jumped to 4.6% – the nation’s highest rate since October 2021.

War headlines today: Hormuz ship struck by an unknown projectile and abandoned.

Via S&P. Flash Australia Composite PMI Output Index: 50.8 Index, sa, >50 = growth m/m % qr/qr (Aug: 52.7) Flash Australia Services PMI Business Activity Index: 51.4 (Aug: 53.2) Flash Australia Manufacturing PMI: 49.3 (Aug: 52.0) Flash Australia Manufacturing PMI Output Index: 46.4 (Aug: 49.6) Here’s the money quote.

Two major banks have joined the chorus, tipping that the Reserve Bank of Australia (RBA) will raise the official cash rate at next Tuesday’s monetary policy meeting.

There is no slowing in the Godzilla El Nino.

Governor Bullock was blatantly hawkish in her statement before Australia’s parliament on Friday.

The US CPI was higher than expected on Friday night.

Bloxo elegantly captured the RBA’s recent choices as between stagflation and recession. It has chosen the latter. Yesterday, two key governors hit the hustings to warn folks that more tightening is coming. The first was the adorable Sarah Hunter, Assistant governor (Economic).

Rate hike calls are reaching screaming levels. Goldman has pivoted. Housing Price Collapse: Australian capital-city prices down 4.6% from March peak, projected 15% decline in Sydney/Melbourne by mid-2027 (largest downturn on record), triggering 130bp drag on consumer spending growth and pressuring GDP via negative wealth effects.

I argued last week that Australia’s globally high inflation is homegrown, as illustrated by services inflation tracking at 4.1% in the year to July, well above the broader trimmed mean inflation rate of 3.6%. Housing inflation is posing a particular problem for the Reserve Bank of Australia (RBA).

The ferrous complex is trading like Chinese stimulus is flowing like the good old days.

Last week’s economic data shook Australia’s interest rate markets.

This week’s stronger-than-expected CPI inflation print from the Australian Bureau of Statistics (ABS) has economists tipping near-term interest rate hikes.

Following Wednesday’s stronger-than-expected trimmed-mean inflation by the Australian Bureau of Statistics (ABS), which led several major banks to forecast imminent interest rate hikes, the ABS on Thursday reported strong household spending in July.

The bank is Goldman Sachs, and it is hard to argue against. The bank notes that the headline monthly CPI rose 1.0% month over month, with year-over-year growth dropping 30 basis points to 3.5% yoy, above both our and market estimates (GSe: +3.1% yoy; BBG: +3.3% yoy).

Following Wednesday’s weaker-than-expected wage growth data, the Australian Bureau of Statistics (ABS) released its July labour force survey on Thursday, which reported rising unemployment.

The Australian Bureau of Statistics (ABS) has released the wage price index for the June quarter, which rose by 0.8% over the quarter to be 3.2% higher year-over-year: The result was in line with analysts’ expectations but 0.1% below what the Reserve Bank had forecast in its latest Statement of Monetary Policy.

When I first visited China in 2002, I was struck by one thing in particular: how wrong the Western view was that we were going to liberalise it.

As expected, the Reserve Bank of Australia (RBA) unanimously voted to keep the official cash rate on hold at 4.35% at Tuesday’s monetary policy meeting.

According to Justin Fabo from Antipodean Macro, there has been almost a full pass-through of the Reserve Bank’s 75 bps of tightening this year into the weighted-average new and outstanding home loan rates.

While rate hikes are off the agenda for now, courtesy of last week’s lower-than-expected trimmed-mean inflation, the Reserve Bank of Australia (RBA) would remain concerned about the strength of consumer spending.

In mid-August 2025, the Albanese government gathered together economists, business leaders and policymakers for its ‘Economic Reform Roundtable’.