Australia: RBA raises the OCR to 2.85% in November – UOB

UOB Group’s Economist Lee Sue Ann assesses the latest RBA meeting (November 1).

Key Takeaways

“The Reserve Bank of Australia (RBA) decided to increase the official cash rate (OCR) by 25bps to 2.85%. It also increased the interest rate on Exchange Settlement balances by 25bps to 2.75%.”

“The next meeting is on 6 Dec, and that will be the final meeting of 2022. We are penciling in another 25bps hike, which will take the OCR to 3.10%. Thereafter, we look for a pause in the current rate hiking cycle.”

“Nonetheless, the RBA has guided that further economic data will be closely watched. In this regard, 3Q22 wage growth data on 15 Nov will be eyed. The RBA will also be releasing its Statement of Monetary Policy (SoMP) coming Fri (4 Nov), which will offer more insights.”