Australia & New Zealand Economics Update Hawkish RBA will hike rates to 2% by year-end The RBA started hiking the cash rate today and sounded hawkish for the first since the start of the pandemic. Our forecast that interest rates will reach 2% by year-end is far above the analyst... 3rd May 2022 · 3 mins read
Australia & New Zealand Economics Update Aussie and Kiwi to fall back as tightening cycles underwhelm The Aussie and the Kiwi have been amongst the best performing G10 currencies against the US dollar so far this year but, while we expect both to remain resilient in 2022, we eventually expect them to... 20th April 2022 · 4 mins read
Australia & New Zealand Economics Update Australia - Government support won’t prevent housing downturn The expansion of the government’s “Home Guarantee Scheme” will only result in a modest boost to housing demand. And with affordability set to worsen sharply as the RBA hikes interest rates, it won’t... 20th April 2022 · 3 mins read
Australia & New Zealand Economics Update Hawkish RBNZ will hike rates to 3.0% The RBNZ’s decision to accelerate its hiking cycle shows it is willing to move decisively to get a hand on surging inflation. That’s in line with our forecast that it will hike the OCR to 3.0% by the... 13th April 2022 · 3 mins read
Australia & New Zealand Economics Update RBA’s resistance to tighter policy waning While today’s policy statement wasn’t outright hawkish, the RBA’s dovishness is waning and we’re confident in our forecast that the Bank will start to lift interest rates in June. 5th April 2022 · 3 mins read
Australia & New Zealand Economics Update Loose fiscal policy adds pressure on RBA to hike rates With the government facing defeat in May’s election, today’s Budget continued the course of loose fiscal policy that began at the start of the pandemic. As the unemployment rate is set to fall to a 50... 29th March 2022 · 3 mins read
Australia & New Zealand Economics Update New Zealand - Fixed mortgages won’t protect the housing market New Zealand’s high share of fixed mortgage rates won’t insulate the housing market from RBNZ rate hikes. Indeed, we’re sticking to our view that house prices will fall this year and cause the RBNZ to... 23rd March 2022 · 2 mins read
Australia & New Zealand Economics Update Migration revival won’t let RBA off the hook Migration is rebounding much faster after the border reopening than we had anticipated. While that will slow the decline in the unemployment rate, the labour market is already historically tight and... 21st March 2022 · 3 mins read
Australia & New Zealand Economics Update Australia - Inflation will hit 21-year high We now expect inflation to reach a 21-year high of 5.2% in Q3 as fuel prices surge and firms pass on higher raw material costs to consumers. With the labour market nearing full employment and... 16th March 2022 · 3 mins read
Australia & New Zealand Economics Update RBA to start hiking in June The RBA still sounded dovish when it kept interest rates unchanged today. However, we suspect that another upside surprise in Q1 inflation will convince the Bank that tighter policy is needed even if... 1st March 2022 · 3 mins read
Australia & New Zealand Economics Update Hawkish RBNZ will eventually need to reverse course The RBNZ sounded hawkish when it lifted rates today suggesting the OCR will rise further than we had previously anticipated. But a more aggressive hiking cycle will be an even bigger headwind to the... 23rd February 2022 · 3 mins read
Australia & New Zealand Economics Update Australia - Slump in fertility need not slow population growth The sharp drop in the fertility rate during the pandemic has already started to reverse. And even if it is sustained, the government will be able to offset a slower natural increase with higher net... 14th February 2022 · 3 mins read
Australia & New Zealand Economics Update RBA to hike rates to 1.75% Continued strength in underlying inflation and activity will prompt the Reserve Bank of Australia to start hiking rates in June. And we now expect the Bank to lift the cash rate to 1.75% by August... 10th February 2022 · 4 mins read
Australia & New Zealand Economics Update RBA ends QE; first rate hike will come in August The RBA today ended its bond purchases, revised up its inflation forecasts and no longer signalled that wage growth needs to be “materially higher” to meet its inflation target on a sustained basis... 1st February 2022 · 3 mins read
Australia & New Zealand Economics Update RBA probably won’t hike before the May election Trimmed mean inflation will probably climb above the upper end of the RBA’s 2-3% target band in Q1, which would add to the case for the RBA to start hiking rates in May. However, the RBA hasn’t... 26th January 2022 · 3 mins read
Australia & New Zealand Economics Update Our key calls for 2022 We think that GDP growth in Australia will surprise to the upside. But with wage growth only approaching the 3% watermark the RBA would like to see by year-end, we expect the Bank to keep rates on... 11th January 2022 · 3 mins read
