“We are thinking about that at present.”īill Evans, Westpac’s senior economist, said: “I don’t think there’s anything in this budget that will make them go, ‘we have to raise rates’.”Įvans said the risks of an extra $12bn in spending would depend in part how consumers respond to measures such as the $3bn in federal and state support for energy bills. “It really depends on the data and whether the RBA thinks inflation returning to target by mid-25 is quick enough,” Oster said. Sign up for Guardian Australia’s free morning and afternoon email newsletters for your daily news roundupĪlan Oster, NAB’s chief economist, said “we don’t think will change the RBA’s thinking at all”. The next change after that would be a cut but not until the December quarter of 2024. “We consider the budget to be relatively neutral on inflation,” Adelaide Timbrell, a senior ANZ economist said, adding the bank still expected the RBA to hike the cash rate one more time by 25 basis points to 4.1% at its August meeting. Should the forecasts for inflation to ease off prove too optimistic, however, the central bank may leave its cash rate higher for longer. BLKloKs4Wa- May 10, 2023Įconomists contacted by Guardian Australia said the budget was unlikely to budge the RBA’s view of the timing or size of any further interest rate rises. Did the budget increase the chances of another RBA interest rate rise? Investors assessed the odds of a rate rise as a 0% chance at the June RBA board meeting before the budget landed.and afterwards? Still 0% chance, with a cut pencilled for next March.

The unlikely disciple