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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Related tickers and likely impact
AUD/USD
▲ Likely positiveRelevance: medium
| Market | Currencies |
|---|---|
| Close on 10/16/2026 | 0.69462 |
| 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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