Post the CPI outcome consensus estimates quickly moved to rates remaining on hold for 2024, although there is a reasonable number of forecasters (8/30) predicting at least one cut by year end. Market pricing also indicates the possibility of a cut, but no full rate cut is priced in until February 2025. CBA make a strong argument for the first rate cut to come in November. Their forecasts have a material fall in the annual rate of headline inflation in Q3 2024 to sit within the RBAs target band, paving the way for a 25bps cut at the November meeting.
The RBA has since announced that they contemplated a rate rise at their August meeting and while they left them on hold at 4.35% they also said “no cuts expected in the next six months.."
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