The RBA Expects More Rate Hikes - Philp Lowe

The RBA Expects More Rate Hikes - Philp Lowe

2022-09-08 • Updated

"When I spoke at the Anika Foundation event last year, CPI inflation in Australia had been below 2 percent for a number of years and, in underlying terms, was just 1.6 percent. Today, CPI inflation has risen to 6.1 percent, and underlying inflation is 4.9 percent. These are the highest rates in many years." - Lowe.

Speaking at the Anika Foundation Fundraiser in Sydney, the governor of the Reserve Bank of Australia revealed that the current discrepancies between the annual inflation forecasts and the actual values have caught everyone by surprise. Last year, the RBA forecasted 2022 inflation rates to be just 1.75%, whereas so far this year, there are reasons to expect 7.75% CPI inflation rates - a big forecast miss! To counteract this, Mr. Lowe has established the need for the RBA to continue hiking interest rates in hopes of reaching the flexible inflation rate targets. He made it clear, however, that the pace of hikes would be much slower.


As we expect continued hikes in interest rates from the RBA and forecasted increases in unemployment rates by the national statistical office of Canada (to be released Friday, 09th September), fundamental factors seem to support a bullish correction on AUDCAD. Technically speaking, the market is trading close to the Daily Support at 0.87922 and has retested a major trendline from 2020.



The Daily Support zone between 1.11008 and 1.10750 is already within reach of the current price action on AUDNZD, and offers the Moving Average 50 and a major trendline as a confluence(img.02)



The major trendline aside, price is also trading between the daily support zone at 0.67399 & 0.66633, thus increasing the chances of a bullish correction, possibly back to the 50-MA or even higher.



CPI Release Will Boost The CAD
CPI Release Will Boost The CAD

Canada's forthcoming Consumer Price Index (CPI) data, set for release on Tuesday, is projected to show a year-on-year decline in inflation to 3.2% for October from the previous 3.8%. This potential inflation dip might offer leeway for the Bank of Canada (BoC) to maintain its overnight rate target at 5.0% in the...

Can JPY Reach New Lows By the End of 2023? 
Can JPY Reach New Lows By the End of 2023? 

Speculation persists regarding the Bank of Japan's potential departure from negative interest rates, yet the USD/JPY maintains its position within a 150–152 range for seven consecutive sessions. Caution is warranted due to a weaker-than-expected Q3 GDP, a slump in imports, and...

Latest news

Can USD Recover?
Can USD Recover?

The EUR/USD pair is making gains, approaching multi-month highs around 1.0960, driven by a weakened USD and Christine Lagarde's somewhat hawkish remarks before the European Parliament. Minor housing data from the U.S., specifically New Home Sales for October, came in below expectations but didn't significantly impact the pair. Lagarde, President of the...

Stock Market Rally. How Far Can It Go?
Stock Market Rally. How Far Can It Go?

Global equities on Wall Street experienced a mixed session following the Thanksgiving holiday, heading for the most significant one-month rally since November 2020. MSCI's global shares index slightly eased but was still on track for an 8.5% monthly gain, fueled by growing investor confidence that U.S. interest rates...

OPEC Boosts The Oil Market
OPEC Boosts The Oil Market

Brent crude futures is maintaining stability this Friday, with traders awaiting an OPEC+ meeting that might lead to further supply cuts. Brent crude was down 8 cents at $81.34 a barrel, following a 0.7% drop in the previous session.

Deposit with your local payment systems

Data collection notice

FBS maintains a record of your data to run this website. By pressing the “Accept” button, you agree to our Privacy policy.


A manager will call you shortly.

Change number

Your request is accepted.

A manager will call you shortly.

Next callback request for this phone number
will be available in

If you have an urgent issue please contact us via
Live chat

Internal error. Please try again later

Don’t waste your time – keep track of how NFP affects the US dollar and profit!

You are using an older version of your browser.

Update it to the latest version or try another one for a safer, more comfortable and productive trading experience.

Safari Chrome Firefox Opera