RBA Rate Hike Odds Plunge to 3% Amid Softer Inflation Data

Bond investors have significantly reduced their expectations for another interest rate rise from the Reserve Bank of Australia this year, following a softer-than-expected inflation print on Wednesday.

The data suggested that the economy is cooling faster than even the central bank anticipated. As a result, traders have largely abandoned their bets for an August rate increase, with the market now pricing in just a 3% chance of a move higher when the RBA board convenes in less than two weeks.

This marks a significant shift from before the data was released, when the market had priced in a roughly 21% chance of another rate hike. The Reserve Bank's decision will have important implications for the Australian economy and financial markets.