Why the RBA Could Hike Again in November | The Bloomberg Australia Podcast

The Reserve Bank of Australia’s decision to lift interest rates to 4.6% stems from a renewed energy price shock and a shift in business behavior, where firms are increasingly passing rising input costs onto consumers. Bloomberg economist James McIntyre highlights that while headline inflation data appears slightly softer than expected, persistent energy pressures—particularly in diesel and petrol—necessitate a proactive monetary policy stance. Structural challenges, including weak productivity growth and the long-term allocation of resources toward social services, further complicate inflation management. The RBA anticipates that the unemployment rate will rise toward 4.5% to 5% to provide necessary spare capacity in the labor market. Consequently, interest rate relief remains unlikely until at least the second half of next year, as the central bank prioritizes cooling the economy against ongoing global and domestic price shocks.