The Reserve Bank of Australia is unlikely to play either Santa or Scrooge at its meeting on Tuesday 6th December, as it will almost certainly leave interest rates on hold at 1.5%. And we believe that the markets have got ahead of themselves by starting to price in the possibility of a rate hike next year as we doubt that the activity and inflation backdrop will support this. In fact, we still believe there is a reasonable chance that interest rates will fall to 1.0% next year.
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