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Related tickers and likely impact
AUD/USD
▲ Likely positiveRelevance: medium
| 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.
Related news
- 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
- Reserve Bank of Australia talking tough about harsher rates for borrowers
Deloitte Access Economics forecasts that underlying inflation in Australia will have been above the Reserve Bank's 2.5% target for a full seven years by late 2028, when it is finally tamed. Governor Michele Bullock faces growing questions about whether blunt interest-rate policy is effective. At the press conference after September's rate rise, she was asked whether monetary policy had become detached from the problems it is meant to solve. She responded that rate increases affect far more than mortgage holders.
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- RBA extreme interest rates push economy towards potential recession
Stephen Koukoulas argues that the Reserve Bank of Australia's aggressive rate policy, now at 4.6%, risks pushing the economy into recession as unemployment rises, house prices fall and consumer confidence plunges. Unemployment has reached 4.7%, a five-year high and up 1.3 percentage points from the 2022 cyclical low, while national house prices are down around 7% from their peak and dwelling approvals have fallen 15% since February. Household spending showed zero growth in August, and iron ore has slumped to about US$90 a tonne, near a decade low. He notes the RBA is the only central bank to have lifted rates to a 15-year high, even though inflation largely stems from the oil shock and housing costs, and says a November hike would be unfathomable. Whether Australia enters recession, he writes, depends heavily on AI and data centre investment.
- Interest rates : Reserve Bank may have to go higher if oil prices continue upward spiral
The Reserve Bank of Australia (RBA) is concerned that inflation will stay elevated because of the fallout from the war with Iran, which could force it to raise rates further even though this may increase unemployment as the economy slows. Oil finished the week at US$106 a barrel and shows no sign of falling, while the RBA's forecasts assumed prices as much as US$20 lower, and diesel is also much higher. Prices for other commodities have climbed too, with wheat up 37%, soybeans up 24%, sugar up 42% and cocoa more than doubled this year. After unemployment rose to a high of 4.7% in September, markets sharply cut the chance of a rate rise to 4.85% at the November meeting, from about one in three to closer to one in five. Governor Michele Bullock and researcher Anthony Brassil warned that high inflation erodes purchasing power and hits households with limited financial buffers hardest.
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