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RBA Downplays CPI Relief, Keeps February Hike in Play

The bank is prioritising the December‑quarter trimmed‑mean CPI over the volatile monthly indicator.

Overview

  • Deputy governor Andrew Hauser said the softer November print was helpful but largely expected and offered “not a lot of news” for policymakers.
  • Annual headline inflation slowed to 3.4% in November while the trimmed mean held at 3.2%, still above the RBA’s 2–3% target band.
  • Hauser reiterated that rate cuts are unlikely in the near term and stressed the board’s focus on inflation outcomes one to two years ahead.
  • Markets are pricing roughly a one‑in‑three chance of a February rate increase, with the Australian dollar and bond yields little changed after the data.
  • Major banks are split on February, with Commonwealth Bank tipping a 25bp hike and ANZ and Westpac expecting a hold, as analysts flag Black Friday discounts versus persistent housing‑driven pressures.