RBA delivered a risk management hike – TD Securities

FXStreet Insights Team FXStreet

TD Securities Macro Research’s Reserve Bank of Australia (RBA) note argues that the September 25bps hike to 4.60% was a risk-management move rather than the start of a new tightening cycle. The team expects no further RBA hikes in 2026 and for policy to remain on hold through 2027.

Policy on hold, AUD seen underperforming

"We stick with our call for no further RBA hikes this year and for the Bank to be on hold for all of 2027. "

"Overall, our read of the Statement was that the RBA delivered a risk management hike without explicitly signaling a rapid follow-up hike. In this regard we differed from the market's hawkish interpretation of the Statement."

"If the RBA does not hike in November, then the option of having to hike in December would be a difficult and an uncomfortable one. The RBA would be loath to deliver this."

"While our base case is for the RBA to keep the cash rate on hold at 4.60%, there is a risk the RBA may need to reconsider hiking again at its Feb'27 meeting. This is not our central view and from a market perspective not a view worth positioning for right now, but one worth considering."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)

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FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

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