What happened
Board minutes revealed a unanimous decision to lift the cash rate to 4.60%. The central bank cited elevated inflation, global energy price shocks, and domestic capacity constraints for the hike. Board members explicitly agreed to accept weaker economic momentum and slower employment growth if necessary to restore price stability across the economy.
Why it matters here
Persistent inflation forces the RBA to keep monetary policy tight, directly dampening asset valuations and consumer demand. For Australian equity and property investors, higher borrowing costs squeeze profit margins and reduce housing credit growth. Unanimous hawkish sentiment signals that the central bank will not pivot until underlying inflation returns sustainably to its 2% to 3% target band.
What to watch
Key signals include the upcoming September quarter labor force data and official inflation figures, ahead of the RBA Monetary Policy Board's next interest rate meeting on Melbourne Cup Day, 3 November.
Source
commbank.com.au