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2d ago

Australia’s Inflation Surprise Upends RBA Cut Bets as Q3 Trimmed Mean Hits 1.0%

The upside print reset rate‑cut expectations heading into next week’s policy decision.

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A composite image of signage of Australia's 'big four' banks ANZ, Westpac, the Commonwealth Bank and NAB signage

Overview

  • Official figures show trimmed mean CPI rose 1.0% q/q versus 0.8% expected and the RBA’s 0.6% forecast, with headline CPI up 1.3% q/q and 3.2% y/y.
  • RBA Governor Michele Bullock had flagged a 0.9% trimmed-mean outcome as a material miss, and the 1.0% reading surpassed that threshold.
  • Markets priced out a November rate cut, with AUD/USD moving higher after the release.
  • Forecasts shifted as CBA now expects the cash rate to stay at 3.6% with no further cuts, Westpac put its call under review, HSBC sees an extended pause, and NAB and ANZ still project a single cut in 2026.
  • The ABS revised the prior quarter’s trimmed mean up to 0.7% and economists highlighted stronger services and housing inflation, with focus now on the RBA’s November 4 decision and updated Statement on Monetary Policy.