“December quarter inflation had the casting vote and voted ‘Yes, hike’,” said Westpac chief economist Luci Ellis, previously a senior RBA official. Westpac’s call followed a similar change by ANZ Bank which also sees a quarter-point RBA hike on Feb 3 to take the cash rate to 3.85%. The RBA, which last cut in August, now faces the prospect of switching to a rate hike much earlier than anticipated. “If inflation remains uncomfortably high in coming quarters, the board will act again,” Westpac’s Ellis said. “Australia’s fourth-quarter inflation reading is hotter than expected, but not hot enough to push the RBA to reverse course on its easing cycle and hike the cash rate at the February meeting.

Source: The Edge Markets January 28, 2026 04:39 UTC