RBA Monitor: Status Quo in June

The RBA is poised to hold its cash rate at 4.35% this June as policymakers evaluate the impact of recent hikes. While underlying inflation persists due to strong demand, signs of cooling in labor and capacity markets warrant a pause.

Key Takeaways

• 1.The RBA is expected to hold the cash rate at 4.35% in June following three consecutive hikes, as recent data shows early signs that policy tightening is beginning to work.
• 2.Underlying inflation remains strong at 3.4% YoY due to resilient domestic demand, despite a headline CPI softening driven by temporary fuel tax cuts.

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