AUD: RBA rate increase forecasts provide backing – BBH

101 finance2026/03/16 09:03

By:101 finance

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RBA Expected to Raise Rates Again

Elias Haddad of Brown Brothers Harriman anticipates that the Reserve Bank of Australia (RBA) will implement another 25 basis point increase, bringing the cash rate to 4.10%. However, the decision is considered finely balanced, with market futures suggesting just over a 50% chance of such a move.

According to Haddad, a rate hike would likely lend some strength to the Australian Dollar, especially given the persistently high inflation within the country.

Chances of Consecutive Rate Increases

The RBA is widely expected to raise its cash rate target by 25 basis points to 4.10% for a second meeting in a row, though the outcome remains uncertain. Current futures pricing indicates a 53% probability of this adjustment.

Haddad’s main scenario is that the central bank will proceed with the rate increase, which should provide some support for the AUD.

Inflation and Economic Outlook

Australia’s headline inflation stands at 3.8% year-over-year, even before factoring in the impact of rising energy costs. The RBA’s internal assessments also point to a positive output gap, signaling that the economy is operating above its usual capacity and facing tighter constraints.

(This report was produced with assistance from an AI tool and subsequently reviewed by an editor.)

Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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