We continue to believe that the RBA will keep policy unchanged at the Oct meeting, although we are penciling in a chance that it will hike one last time this year, taking the cash rate target to a peak of 4.35%. In terms of timing, this is likely to occur at the 7 Nov meeting, following the release of the 3Q23 CPI on 25 Oct.

Another factor that could prompt the RBA to hike once more is the risk that wages in the third quarter could spike higher after a large mandated increase in the minimum and award wages.