Attention focused on Reserve Bank officials

COMMENTS by senior Reserve Bank of Australia officials will be closely monitored as anticipation builds towards another interest rate hike later this month.

The central bank’s chief economist, Sarah Hunter, will participate in a fireside chat at a Regional Australia Institute summit in Canberra on Monday.

Then, RBA governor Michele Bullock will appear before a parliamentary committee on Friday.

Both are expected to echo recent comments from bank officials reiterating that inflation is too high and leaving the door open to further interest rate hikes, following the three the bank has handed down so far in 2026.

Hunter and RBA deputy governor Andrew Hauser sent bonds markets into a spin in separate hawkish speaking appearances last week.

Markets are now pricing in about a four in five chance the RBA will lift the cash rate by 25 basis points on September 29.

Westpac’s economics team was the last of the big four banks to drop their call for no more rate hikes following Hauser’s appearance on ABC’s 7.30 program.

But Westpac chief economist Luci Ellis still thinks the RBA is more likely to hike in November than September.

Even though July monthly inflation data surprised strongly to the upside, the board tends to prefer to move after less volatile quarterly inflation data.

“Overreacting to a noisy monthly print is something they have previously said they would not do,” Ellis said.

“That said, if the internal members felt the situation was more urgent and wanted to get the hike done in September, we believe they could muster a majority of Monetary Policy Board votes in favour.”

Strong consumer price data has meanwhile reinforced expectations among Wall Street investors that the US Federal Reserve will also raise rates to fight inflation.