As Michele Bullock addressed media following September’s meeting, she wanted to stress we were now in “quite a positive situation” in terms of inflation and employment. It was a rare declaration of optimism from Bullock who has become renowned for her cautious approach.
But as the RBA board and Bullock have repeatedly warned in 2025, things can quickly change in what is an “uncertain” environment domestically and globally.
On September 30, Bullock refused to speculate on the possibility of a future rate cut, and in hindsight, it appears caution was wise.
Michele Bullock following September’s decision. Source: Newswire
“I can’t say what [the current position] means for next month or the month after because it is going to depend on what the data tells us, and we’re going to have to wait for that,” she said.
Fast forward five weeks and it seems a rate cut that was pencilled in by many for November has quickly vanished with inflation taking an unexpected turn.
Graham Cooke, head of consumer research at Finder, agreed it was clear hopes of a cut have now “largely evaporated” for this meeting.
“The RBA wants to see inflation sit somewhere between 2 and 3 percent, and it just edged above the top threshold,” Cooke said.
“The RBA will want to see that number trending down again before relieving any more cash rate pressure.”