Bendigo Bank economist warns Australia may face one more rate hike by year-end despite July pause
AI Market Summary
Australian rates are likely to stay restrictive: an economist flags ongoing RBA tightening bias and a non-trivial risk of another hike despite lower headline CPI, with core inflation still above target. That backdrop pressures interest-rate-sensitive sectors and reinforces a higher-for-longer AUD rates narrative. Housing is entering a ninth downturn, with Sydney and Melbourne forecast to fall 7%–8%, adding domestic growth headwinds while recession risk is framed as low.
Impact level
● Medium
Affected assets
NCFXAUD2USD/USDT+0.59%
AI Insight · NCFXAUD2USD/USDTAI Insight
▼ Bearish
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Bendigo Bank economist David Robertson warned that Australia could still face another interest-rate increase before the end of the year, even after the RBA paused in July and with core inflation still above target. He said headline CPI fell to 4% in May, but core inflation rose to 3.6% and is likely to stay above target for at least another 12 months. He also flagged that the housing market has entered a ninth downturn cycle, with Sydney and Melbourne expected to fall 7%–8%. The Middle East war was cited as a potential upside risk to oil prices, without referencing any new military action or supply disruption.
