Rates plot twist
Today's surprise inflation figures have pushed back rate cut forecasts, with some economists now even saying another hike can't be ruled out.
It’s line ball who should be more nervous about today’s inflation figures: Treasurer Jim Chalmers or Reserve Bank governor Michele Bullock.
Capital Brief and others have written at length that the final mile of getting inflation back under control is often a volatile one. But even so, today’s trimmed mean 4% inflation rate came as a surprise.
At the next RBA interest rate decision press conference on 7 May, just one week before the budget, Bullock now faces the prospect of telling the public that she still cannot foreshadow interest rate relief.
Bullock has consistently said the board will be data-dependent and will not be rushed. She wants solid, numerical proof that underlying inflation is heading back into the 2% to 3% target band before they properly contemplate cutting rates.
