CBA has moved forward its expectation for the first rate hike of the cycle from the RBA
- now expecting the lift-off hike in June 2022 from previously forecasting August 2022
CBA are expecting Q1 core inflation "will be a lot stronger than the RBA's forecast", citing:
- input costs have risen very swiftly ... feeding through to faster growth in output prices
CBA projects core inflation in Q1 at 1.2% q/q, annually 3.5% (note the RBA target is 2 to 3%, and the current RBA forecast is 3.25% but not until Q2)
- "Our expectation is that the RBA will shift to an explicit hiking bias at the May Board meeting following a big upside surprise on underlying CPI"
Q1 inflation data from Australia will be released on April 27.
