A Material Miss

The Reserve Bank of Australia will make its November policy rate announcement on Tuesday the 4th of November. The Cash Rate Target currently sits at 3.60%, a level that RBA Governor Bullock has recently described as “marginally restrictive”. Market expectations of policy action from the RBA vacillated substantially in over the course of October. At the start of the month OIS futures implied a ~33% chance of a 25bp cut at the November meeting. This rose to almost 80% following the release of a poor September employment report on October 16th before falling to less than 10% following the publication of the Q3 CPI inflation report on October 29th.