Analysts at National Australia Bank (NAB) offer a sneak peek at what to expect from Tuesday’s Reserve Bank of Australia’s (RBA) monetary policy decision.

Key quotes

“The RBA meets on Tuesday and is expected to deliver another 50bp hike, taking the cash rate to 1.85% and its highest since April 2016.”

“A 50bp hike is an overwhelming consensus (22 of 23 analysts surveyed) and 47bp is currently priced by markets.”

“The possibility of a larger hike of >50bps though cannot be entirely ruled out.”

On RBA's Statement on Monetary Policy due Friday, “a full forecast update comes Friday in the August SoMP. The RBA will have to lift its inflation profile and lower its near-term unemployment projection with the focus on whether the forecasts show a credible path back to at target inflation.”