The RBA has hiked the rates. Whether it was this month, or next month, or even should have been last month, almost doesn’t matter.
The budding inflationary pressures, low unemployment, declining impact of the pandemic, and more, have resulted in the RBA joining the globally synchronised monetary tightening cycle.
We are well positioned for this, with significant exposure to stocks with positive rates beta, acquired at attractive valuations, for precisely this outcome.
The banks outlook statement matches our expectations. The pathway (forward guidance) to higher rates is well set.
Macro market movements are consistent with a slightly tighter than expected outcome, with the AUD moving up on the announcement…
…as have yields…
…with the market moving lower.
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