Australia’s central bank is expected to pause rate hikes after Q2 inflation undershot forecasts, easing pressure for further tightening.
The Reserve Bank of Australia is set to maintain its Official Cash Rate at 4.35% for a second straight meeting, with the decision due at 04:30 GMT. The move follows softer-than-expected inflation data, reducing bets on an August rate hike.
Underlying inflation, measured by the Trimmed Mean CPI, rose 0.8% quarter-on-quarter in Q2, below the 0.9% forecast. Annual Trimmed Mean inflation edged up to 3.6%, remaining under the RBA’s 3.8% projection. Markets had previously priced in a potential hike but shifted stance after the latest CPI release.
The Australian Dollar may see volatility around Governor Michele Bullock’s press conference at 05:30 GMT, as traders assess the RBA’s future policy path amid cooling inflation pressures.