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The RBA’s first hold of CY26 anchored the domestic chat on this week’s HotCopper Wire, where Isaac McIntyre and Jonathon Davidson picked through a forecasting landscape that’s quietly tilting toward rate cuts, even as inflation refuses to lie down and the central bank keeps the door ajar for more hikes.
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The cash rate stayed put at 4.35% after the June meeting, which McIntyre reckoned was “no real surprise.” The HotCopper Wire lead host pointed out that the more telling moment came afterwards, when Governor Michele Bullock framed the decision as “a pause in their larger plan, not some kind of pivot.”
With underlying inflation still above the RBA’s target, McIntyre noted, the board is explicitly keeping the door open for further hikes, even as most of the big four tip a few chops through CY27 that “may even come a little quicker.”
McIntyre’s own lean ran the other way: “I suspect it’s more than likely that some hikes are coming in the near future as we slowly figure out this inflation.”
“Look, I’m honestly not sure where the RBA is going to go,” Davidson admitted. “I don’t think anybody is.” His framing: The next 60 days and a CPI read, or two, will matter, alongside unemployment and whatever inflationary upside is “baked in but not yet apparent” off the back of the Iran war.
It’s that lack of agreement that defines things. “In trying to hear the wind in the leaves, the banks aren’t uniform,” Davidson said, before running the tipping board: CBA and ANZ say cuts coming; Westpac doesn’t think things are done. And, Morgan Stanley and Goldman Sachs both expect the RBA to hold.
The offshore picture muddies things further, too. The European Central Bank raised at its latest decision, while the U.S. Federal Reserve held overnight, though plenty on Wall Street still see the big risk of an American hike later this year.
Davidson flagged new Fed chief Kevin Warsh as “more measured than I think many feared from a Trump handpicked Fed chief. One to watch.” Back home, with Bullock still warning inflation is too high and upside risks remain, his reminder for the optimists is the RBA has already delivered three hikes that wiped out the three cuts before, and that the fuel excise cut lands at the end of June.
Where does all that leave the listener? McIntyre’s honest summary: “There’s no real consensus; we need more data.” His back-up plan, and the one he suspects most Australian investors are running, too, is pure vibes.
“Blocking their hands over their ears and saying ‘la, la, la,'” he joked. “An interesting couple of months for all the economics heads out there.”
You can listen to the full HotCopper Wire episode below.
You can also find the POD to listen to and download over on Spotify.
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Disclaimer, as spoken by Isaac McIntyre in the HotCopper Wire episode: Any information or advice in this HotCopper podcast recording is intended for education and entertainment purposes. Any advice is general in nature and does not take into consideration your objectives, financial situation or needs. Before acting on general advice, you should consider whether it is relevant to your needs and read the relevant Product Disclosure Statement. And if you are unsure, please speak to a financial professional.
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