A rate hike coin toss
Strap yourself in because the latest quarterly inflation stats are out, and they’re not where we wanted them to be… Prices rose 1.2% in the July-September quarter, bringing the annual inflation rate to a still-too-high 5.4%. The main culprits were petrol, electricity, rents, and the costs of buying a home – those contributed to an increase higher than the 1.1% expected. As for what it means, earlier this week, Governor Michele Bullock said the Reserve Bank board “will not hesitate to rate the cash rate further if there is a material upward revision to the outlook for inflation.” But Treasurer Jim Chalmers put his spin on it yesterday, saying the figures are “consistent with our expectations. It doesn’t materially change the inflation outlook going forward.” Economists are now split on whether the Reserve Bank will raise interest rates in its upcoming 7 November meeting. Until then…
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