Traders have raised their bets on a Reserve Bank rate hike in November after Deputy Governor Andrew Hauser said the board is considering further increases despite the costs to the economy and jobs. Hauser described "hard choices" as the inflation outlook worsens and expectations risk becoming embedded, with many businesses now seeing around 3.5 per cent as the new normal. Inflation data for the September quarter, due out on October 28, will be pivotal, and underlying inflation is tracking above the bank's August assumption. Much of the oil price rise from the Middle East conflict has yet to be passed on by businesses, which fear losing customers. Although the jobless rate rose to 4.7 per cent, easing some pressure, Hauser said unemployment remains relatively low by international and historical standards, and the RBA will set out its answers in a week or two.
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AUD/USD
• NeutralRelevance: low
| Market | Currencies |
|---|---|
| Close on 10/20/2026 | 0.70040 |
| Change that session | +0.35% |
Impact is scored by AI from the headline and may be wrong. It is not investment advice.
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Traders have raised their bets on a November rate hike after RBA deputy governor Andrew Hauser said the board is considering further increases, even though this would weigh on activity and unemployment. Hauser described “hard choices” as inflation worsens and the jobs market softens, warning that expectations of higher inflation are becoming embedded amid the Middle East supply shock. He said an increasing share of businesses see inflation of around 3.5% as the new normal. September-quarter inflation data due October 28 will be pivotal, with underlying inflation likely to print higher than the bank assumed in August and much of the oil price rise yet to be passed on by businesses. Economists said the jobless rate rising to 4.7% eased pressure to hike again, but Hauser noted unemployment remains relatively low by international and historical standards.
- Odds of fifth interest rate hike this year likely to shorten as RBA deputy warns inflation outlook worsening | Reserve Bank of Australia
The chance of a fifth rate rise this year on 3 November, Melbourne Cup day, jumped from 30% to 45% after RBA deputy governor Andrew Hauser warned of “hard choices” and a “materially worse” inflation outlook. Hauser said some Australians were doubting the RBA could bring inflation back to its 2.5% target, and that a growing share of businesses saw 3.5% as the “new normal.” If delivered, a hike would lift the cash rate target to 4.85% from 4.6%, its highest level since the global financial crisis. AMP’s Diana Mousina still found a November hike hard to see given weakening jobs data, saying next week’s inflation figures would likely decide the outcome.
- Odds of fifth interest rate hike this year likely to shorten as RBA deputy warns inflation outlook worsening
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