RBA to hold rates at 3.85% in June, but may raise again soon

Australia's central bank will keep key interest rate unchanged at 3.85% on Tuesday despite inflation staying well above the target range,” per the latest Reuters poll of nearly 30 economists.

Key findings

While expectations for future rate hikes were very much alive, a strong three-quarters majority of economists, or 22 of 30, forecast the RBA to hold its official cash rate at 3.85% on June 6.

The remaining eight in the poll taken between May 29 and June 1 poll expected a 25 basis point hike.

Interest rate futures were pricing in a roughly one-in-three chance of a rate hike then.

More than half of respondents, or 18 of 28, expected rates to reach 4.10% or higher by end-September, including four who saw rates at 4.35%. The remaining 10 expected rates to stay at 3.85%.

Also read: AUD/USD bulls await Aussie wage announcements, US NFP on the way to 0.6600

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