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ANZ has just released a forecast that the RBA will raise the cash rate in late 2023 and has predicted the level to which it could rise.
"The tighter labour market will drive wages growth and ultimately inflation higher,” a release from the bank stated.
"The bands of uncertainty around our forecasts remain wider than usual,” It continued.
And even though the bank has predicted a late 2023 hike – it conceded that a rate hike may come sooner – or later.
“It is possible that the conditions for rate hikes arrive even earlier than the second half of 2023 if the recent trend of rapid improvement in the economy continues,” said the statement. “But there is also the prospect that the recovery is knocked off track by COVID and rate hikes are delayed.”
The bank’s economics team predicted, with its caveat above, that the RBA’s rate rise will come in two stages, ending up at 0.5% – a figure not seen since March 2020. This would be up to a year earlier than the RBA’s stated intention to keep the current cash rate until “at least” 2024.