Australia's 2.1% Growth Lifts RBA September Hike Odds to 70%
Updated
Updated · ABC News · Sep 2
Australia's 2.1% Growth Lifts RBA September Hike Odds to 70%
3 articles · Updated · ABC News · Sep 2
Summary
Traders raised the chance of a Reserve Bank of Australia rate increase this month to about 70%, up from roughly 50% before GDP data showed the economy grew faster than expected.
Australia's economy expanded 0.4% in the June quarter and 2.1% from a year earlier, beating forecasts of 0.3% and 1.8% and reinforcing concerns growth is not slowing enough for inflation to return to target.
Market pricing now fully reflects a hike by November and implies the cash rate will peak at 4.8% by mid-2027, nearly two increases above the current 4.35%.
Housing investment and household consumption each supported growth, but spending was narrow: vehicle purchases jumped 10.3%, while essentials spending fell 0.3% and economists flagged flat per-capita GDP and weak productivity.