Latest from National Australia Bank on their Reserve Bank of Australia outlook:
- We expect the (monthly CPI) data to further solidify the need for the RBA to continue hiking in the near-term and see the RBA hiking rates by 25 bps in December, February, and March to 3.60%.
- Thereafter the key for the RBA outlook is whether wages growth remains consistent with a return of inflation to target as we assume – Governor Lowe has previously cited WPI wages growth of around 3½-4.0% as being consistent assuming a 1% productivity assumption.
- In coming months, the market services components of CPI will be watched closely given its sensitivity to wage outcomes and the tendency for services inflation to be stickier than for goods.
The RBA so far this year: