This RBA Rate Hike Will Drive Australia Precipitously into Recession.

The RBA hiked rates against most expectations today. It is interesting that RBA acknowledged consumer spending is moderating, there is a slowing, yet chose to still raise rates again?
ACY Securities | 1286 hari yang lalu

The RBA hiked rates against most expectations today.

It is interesting that RBA acknowledged consumer spending is moderating, there is a slowing, yet chose to still raise rates again?

Even though nothing has changed from their previous meeting. Inflation was stubbornly high then.

The question has to be asked, what was that pause all about? Was it more about the Independent Review and concerns felt there, than it was about inflation expectations by the Governor and Board?

The RBA remains a very political animal.

There is no doubt this rate hike, with the accompanying commentary suggesting more rate hikes are coming, will take the wind completely out of the sails off the momentary stabilisation in the property market. It will also most most certainly tip Australia well into recession.

Certainly the inflation issue remains a serious problem, and knowing the RBA I have always forecast a higher end rate nearer 4.5% to 5.5%. That looks like where we are now headed.

However, given the previous pause, it did appear the RBA had recognised that being so late to recognise rocketing inflation in the first place, there was already significant pain for consumers and businesses from the price increases alone, and therefore raising rates risked a too severe dampening of activity. One that would precipitate a full blown Recession.

Expect Australia to experience that full blown recession in the second half of this year. As the RBA continues to blunder its way forward.

Clifford BennettACY Securities Chief Economist

The view expressed within this document are solely that of Clifford Bennett’s and do not represent the views of ACY Securities.

All commentary is on the record and may be quoted without further permission required from ACY Securities or Clifford Bennett.

This content may have been written by a third party. ACY makes no representation or warranty and assumes no liability as to the accuracy or completeness of the information provided, nor any loss arising from any investment based on a recommendation, forecast or other information supplied by any third-party. This content is information only, and does not constitute financial, investment or other advice on which you can rely.

ACY Securities
Tipe: STP, ECN, Prime of Prime, Pro
Regulasi: ASIC (Australia), FSCA (South Africa), FSA (SVG)
baca selengkapnya
Stocks sink amid AI wipeout, dollar shines ahead of NFP

Stocks sink amid AI wipeout, dollar shines ahead of NFP

Nasdaq leads equity losses as AI outlook dims on fears of datacentre revolt. AI rout deepens in Asia but US futures point to some easing in selloff. Gold’s rebound hits a wall as traders turn to the safety of US dollar. Attention to turn to NFP report as December rate hike bets fade.
XM Group | 2 hari yang lalu
The dollar saves the day

The dollar saves the day

The dollar rebounds as the AI-driven S&P 500 sell-off boosts safe-haven demand, while the BoE’s first hike since 2023 fails to support the pound.
FxPro | 2 hari yang lalu
Tech Stocks Lead US Selloff Ahead of Payrolls

Tech Stocks Lead US Selloff Ahead of Payrolls

AI-related shares led the worst US equity session since 2020 as investors feared tighter oversight of AI and data-center buildout following the midterm results; Truist called it a “buyers’ strike in tech.” The selloff is spreading beyond Wall Street: Korean chipmakers fell about 10% before the open, the Kospi dropped below 5,000, CoreWeave’s five-year credit default swap widened to a record
ATFX | 2 hari yang lalu