The RBA Board is likely to sit on the sidelines for at least several months.
A 4.35% cash rate didn’t previously get the job done on inflation and our view has been that 1-2 more hikes would be necessary.
Our conviction in that broader view has weakened amid heightened uncertainty on several fronts. Hiring tailwinds have also faded.
It’s not clear, however, how much of the softening in activity indicators can be apportioned to higher interest rates or elevated uncertainty.
