RBA Hike Expectations May Be Excessive, Commerzbank Warns

Commerzbank's Volkmar Baur believes that market expectations for further Reserve Bank of Australia (RBA) hikes may be too high after the release of softer August Consumer Price Index (CPI) data.

The inflation rate remains above target, but Baur points out that interest rate hikes take time to have an effect and are particularly lagged in the real estate sector.

He notes that building permits fell 6.1% in August compared to the previous month, and prices in major cities continue to decline.