It's a sparse session ahead for data and events.
Note that Japanese markets are closed again today for a holiday. Japan was closed on Monday and will be closed again on Wednesday.
Reserve Bank of Australia Governor Michele Bullock takes part in a fireside chat hosted by CEDA in Sydney at 1:00pm AEST today,
with a Q&A open to the media. The appearance comes a week before the RBA's September 28-29 meeting, where a 25 basis point increase from the current 4.35% cash rate is widely expected.
Investors will be listening for any change from the firm tone she struck before a parliamentary committee on Friday. Bullock said the upside inflation risks flagged in August are now materialising, and framed the central question as whether tightening so far is enough to return inflation to target in a reasonable time. In further comments she said there is a general consensus that the neutral rate has risen, that inflation risks are skewed to the upside, and that persistent shocks are hard to look through. She also pointed to higher-for-longer oil prices and to businesses being more willing to pass on cost increases. The Australian dollar firmed on the remarks.
Deputy Governor Andrew Hauser added that the Board is totally committed to hitting the inflation target, while UBS said it now expects two more hikes, taking the cash rate to a 4.85% terminal rate. Markets had put the odds of a September increase at roughly 70 to 75% after Friday's comments.
The fireside format tends to be less scripted than a formal speech, so questions on oil, cost pass-through and how far rates need to rise could draw more detail. Central bank speakers often use such appearances to reinforce existing pricing rather than reset it, so a repeat of Friday's language would likely keep a September hike firmly in play. Australian labour force data on Thursday is the next key input before the decision.
This article was written by Eamonn Sheridan at investinglive.com.
Source: Investing Live - Central Bank
