Overview

• The central bank is expected to leave the cash rate unchanged on Tuesday, with focus on how Governor Michelle Bullock frames inflation and growth risks.
• Annual inflation in the monthly CPI rose to 3.0% from 2.8%, denting hopes for an immediate rate cut despite the RBA’s emphasis on upcoming quarterly data.
• Commonwealth Bank says the odds of a November cut have fallen below 50% from around 80% earlier this month, reflecting firmer inflation prints and resilient activity.
• Only 11% of CBA mortgage customers reduced repayments after August’s 25bp cut, suggesting households are banking rate relief rather than lifting spending.
• Forecasts diverge on the path ahead, with Westpac still projecting 25bp cuts in November, February and May while several other major banks no longer expect another cut this year and Q3 CPI looms as the key test.