Daily Commentary BY THE CURVE TEAM –

Daily Insights – Inflation Awaits

26th of October, 2021

Inflation Market Reaction

  • CPI for Q3 is out tomorrow.
  • Last week bond yields jumped following a high New Zealand inflation number, so the same may happen again.
  • ANZ believe the RBA will not read too much into the inflation number, even if it is higher than expected.

S&P Update on Banks

  • “Our current ratings on Australian banks–most of which are on positive outlook–factor in our expectation that the regulators will take timely and effective actions to mitigate risks from rapidly rising house prices and home loan growth. Failing this, the upside for our ratings on the Australian banks is likely to recede.”
  • Even though banks gain in the short term by a lack of regulation, S&P acknowledge that over the medium and long term it would pose more risk.

Josh Stewart

Associate - Money Markets