RBA Decision Triggers Divided Opinions Among Economists

The Reserve Bank of Australia (RBA) held rates at 4.35% in August, but economists are divided on what comes next.

Some forecasters believe that external risks, particularly spiking Brent crude prices, could force the RBA to hike rates as soon as September.

MUFG warns of a global inflation shock due to energy costs and markets have already priced in a full rate hike by March 2024.

However, National Australia Bank (NAB) expects steady quarterly GDP growth with rates staying on hold through 2026, followed by a first rate cut around mid-2027.