MONETARY POLICY – AUSTRALIA

Key costs that rose 50pc in five years

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Original article by Anthony Keane
The Australian – Page: 4 : 26-Aug-26

Analysis of official price data for the last five years shows that the cost of some household products and services has risen significantly more than the overall inflation increase of 24 per cent over this period. The cost of household gas has risen by 48 per cent since mid-2021, while the price of cooking oil and fats is up 47 per cent; meanwhile, the average household is paying 38 per cent more for electricity than five years ago, while the price of both milk and coffee has risen by 35 per cent. AMP’s chief economist Shane Oliver says inflation is likely to slow in coming months, but he warns that it will be "fairly painful" for households for at least the next year; he adds that the inflation outlook means the Reserve Bank is likely to increase the cash rate again by the end of 2026.

CORPORATES
AMP LIMITED – ASX AMP, RESERVE BANK OF AUSTRALIA

El Nino to affect interest rates and some ASX stocks

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Original article by Gus McCubbing
The Australian Financial Review – Page: 23 : 26-Aug-26

The current El Nino weather event in the Pacific Ocean began in June and is expected to last well into 2027; it is likely to put upward pressure on food prices, and therefore Australia’s inflation rate. There are fears that it could become a ‘ Super El Nino’, and Citi commodity strategist Arkady Gevorkyan says this is the firm’s highest-conviction agricultural risk. Citi notes that Australian crops such as wheat, barley, and canola are most at risk from an El Nino event. On the other hand, Morgan Stanley says the metals market could be boosted if copper production in Chile and Zambia is impacted by El Nino.

CORPORATES
CITIGROUP PTY LTD, MORGAN STANLEY AUSTRALIA LIMITED

Bullock rings alarm on living standards

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Original article by Michael Read
The Australian Financial Review – Page: 3 : 29-Jul-26

Reserve Bank of Australia governor Michele Bullock has warned that slowing productivity growth is making the domestic economy more vulnerable to global shocks. She also stated that the nation’s living standards will continue to stagnate unless the issue of productivity is addressed. Bullock also said the RBA will be open to further interest rate rises if this is deemed necessary to achieve its mandate of keeping the unemployment rate as low as sustainably possible while returning inflation to its target range of 2-3 per cent. Inflation data for the June quarter will be released today, and could determine whether there is another official interest rate rise in August.

CORPORATES
RESERVE BANK OF AUSTRALIA

Price tumbles spread to all capital cities

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Original article by Thomas Henry, Noah Yim
The Australian – Page: 1 & 4 : 7-Jul-26

HSBC Australia’s chief economist Paul Bloxham says the bank’s central forecast is for house prices to fall by up to eight per cent nationally by the end of 2027, including 2-6 per cent next year. He adds that the pace of decline in June suggests that there is downside risk to HSBC’s central forecast, with Cotality’s home value index falling by 0.4 per cent nationally in June. Bloxham warns that official interest rate cuts are likely to be needed to deliver a housing market turnaround, but this is unlikely to occur in the next year. Meanwhile, Westpac’s senior economist Pat Bustamante says the major bank expects a further two interest rate rises in the current monetary policy cycle.

CORPORATES
HSBC AUSTRALIA HOLDINGS PTY LTD, COTALITY, WESTPAC BANKING CORPORATION – ASX WBC

Rate rise cycle not over yet: Bullock

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Original article by Matthew Cranston, Jack Quail
The Australian – Page: 1 & 5 : 17-Jun-26

Treasurer Jim Chalmers has welcomed the Reserve Bank of Australia’s decision to leave the cash rate on hold at 4.35 per cent. Chalmers has attributed the monetary policy board’s unanimous decision to factors such as the federal government’s "responsible" budget and the US-Iran peace deal. However, RBA governor Michele Bullock has not ruled out further interest rate rises, noting that inflation remains high and the government’s budget tax reforms have resulted in increased uncertainty across the economy. Bullock adds that the RBA expects economic growth to slow but it is not forecasting a recession.

CORPORATES
AUSTRALIA. DEPT OF THE TREASURY, RESERVE BANK OF AUSTRALIA

Handouts row: Take a hike, says Reserve

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Original article by Matthew Cranston, Thomas Henry
The Australian – Page: 1 & 5 : 6-May-26

Treasurer Jim Chalmers says the Reserve Bank of Australia’s decision to increase the cash rate to 4.35 per cent yesterday will add to the pressure that families and businesses are already facing. He adds that the federal governments intends to play a helpful rather than harmful role in the fight against inflation. However, RBA governor Michele Bullock has cautioned against giving households more money in next week’s budget, arguing that this would make it harder for the central bank to bring inflation under control. AMP’s chief economist Shane Oliver says the government should reduce public spending in the budget to help alleviate underlying inflation pressures, while also introducing reforms aimed at boosting productivity and capacity in the economy.

CORPORATES
AUSTRALIA. DEPT OF THE TREASURY, RESERVE BANK OF AUSTRALIA, AMP LIMITED – ASX AMP

Traders see end in sight for RBA rate rises

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Original article by Cecile Lefort, Jonathan Shapiro
The Australian Financial Review – Page: 23 : 6-May-26

Money markets still expect the Reserve Bank of Australia to increase official interest rates by another 25 basis points by September; at 4.6 per cent, the cash rate would be at its highest level since 2011. However, bond traders now expect just one more rate rise in 2026, with the chances of two more increases having been pared back from 80 per cent to 65 per cent. IFM Investors’ chief economist Alex Joiner says the RBA’s revised economic forecasts imply that its preferred measure of underlying inflation will return to its target of 2.5 per cent by February. He says this suggests that the central bank could switch to an easing bias in late 2026 or early 2027.

CORPORATES
RESERVE BANK OF AUSTRALIA, IFM INVESTORS PTY LTD

Aussie dollar to fly as RBA goes it alone on rates

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Original article by Grace Lagan
The Australian Financial Review – Page: 23 : 29-Apr-26

The US Federal Reserve, its British and Canadian counterparts and the European Central Bank are widely tipped to leave official interest rates on hold this week. In contrast, the Reserve Bank of Australia is expected to increase the cash rate next week, for the third time in 2026; inflation data for March is likely to strengthen the case for another rate rise. Foreign exchange strategies note that the Australian dollar and local bonds are likely to benefit from the widening gap between domestic and international interest rates.

CORPORATES
UNITED STATES. FEDERAL RESERVE BOARD, EUROPEAN CENTRAL BANK, RESERVE BANK OF AUSTRALIA

RBA delivers recession warning

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Original article by Lea Jurkovic
The Australian Financial Review – Page: 1 & 4 : 18-Mar-26

The latest official interest rate increase will put further on the federal government ahead of the budget in May. Treasurer Jim Chalmers says the Australian economy was already facing an inflation challenge, and the Iran war has made this harder. Reserve Bank of Australia governor Michele Bullock has warned that a recession is a possibility if inflation is not reined in; she has also emphasised the need to clamp down on inflation before it spreads across the economy. Bullock adds that inflation was already too high before the rise in petrol prices due to the war, and the cost of petrol was not the reason for the rate increase. The RBA’s monetary policy board voted 5-4 to increase the cash rate on Tuesday, and Bullock says the board’s split was in relation to the timing of a rate increase rather than the need for one.

CORPORATES
RESERVE BANK OF AUSTRALIA,AUSTRALIA. DEPT OF THE TREASURY

Interest rate increases set to hit mortgage holders in Victoria, Queensland, and Tasmania the hardest

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Original article by Roy Morgan
Market Research Update – Page: Online : 10-Feb-26

The most recent Roy Morgan data on mortgage stress shows that 24.5% of mortgage holders are now ‘At Risk’ of mortgage stress. Last week’s interest rate rise is expected to increase this to 25.3%, and a 25 basis point interest rate rise in March to 4.1% would increase this to 27.2% (1,322,000 mortgage holders). A deep dive into Roy Morgan’s data on mortgage stress by State shows that the situation is worst in Tasmania; 29.8% of mortgage holders are classified as ‘At Risk’, and this will increase by 3.8% points to 32.6% if the Reserve Bank increases interest rates again in March. In clear second place is Victoria with 27.2% of mortgage holders classified as ‘At Risk’ and set to increase to 29.9% (up 2.7% points) following another RBA interest rate increase. However, a potential RBA interest rate increase will hit hardest in Queensland and would mean 26.8% of mortgage holders are ‘At Risk’ – an increase of 3.2% points. Overall, 17.1% of mortgage holders are ‘Extremely At Risk’, and this will increase by 2.4% points to 19.5% if the Reserve Bank increases interest rates in March (947,000 mortgage holders).

CORPORATES
ROY MORGAN LIMITED, RESERVE BANK OF AUSTRALIA