Commentary from the Reserve Bank (RBA) over recent days makes it clear that Australia’s cash rate will move up again soon. Accordingly, we have brought forward our forecast and now expect a 25bp hike to 4.75% on 3rd October. The external threats to the upswing have diminished while the consumer caution on spending, which the RBA had hoped would curb the rise in domestic demand, is fading given the big improvement in the labour market.
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