RBA Faces Interest Rate Hike Amid Construction Boom
The Reserve Bank of Australia (RBA) is facing a challenging decision regarding its monetary policy in light of strong construction growth and historical parallels to past oil shocks and inflation spikes.
Rabobank notes that building approvals are near record GDP shares, with data centers driving growth at an unprecedented pace.
The bank's Ben Picton expects the RBA to hike interest rates by 25 basis points, taking the official cash rate to 4.60%, which would support the Australian Dollar.