Reserve Bank of Australia (RBA) Deputy Governor Andrew Hauser is due to speak shortly, beginning at 12.45 pm Sydney time (0245 GMT / 2245 US Eastern time). Hauser took up the deputy role in early 2024 after more than two decades at the Bank of England, where he led its markets directorate, and speeches by the RBA's senior ranks between board meetings are among the few scheduled opportunities to gauge how the Bank's thinking is evolving.

As background to Hauser's appearance, the RBA raised the cash rate three times in early 2026, lifting it to 4.35 percent, after judging in February that demand was outstripping supply capacity by more than expected. The Bank has since held the rate at that level for two consecutive meetings, most recently on August 11, maintaining a conditional pause rather than declaring victory.

Inflation remains the sticking point. Headline CPI sits around 3.8 percent as of the June quarter, still above the 2-3 percent target band, and trimmed mean measures have been sticky rather than falling cleanly. Hauser has repeatedly stressed that the Board still has "work to do," describing price growth as far too high even as some relief has come through from softer fuel costs. He has leaned on Phillips curve logic — the framework that ties inflation to how much slack remains in the labour market — to justify the early, front-loaded hikes, arguing that acting promptly when the economy sits on the steeper part of the curve limits the eventual unemployment cost.

Two live complications sit alongside the domestic inflation fight. The first is wages: Wednesday's Wage Price Index (WPI) from the Australian Bureau of Statistics showed private sector wage growth continuing to moderate to its slowest pace this cycle, at 3.2 percent annually, giving the Board some room, although the Fair Work Commission's larger-than-expected 4.75 percent award wage increase lands in Q3 and is expected to push WPI back up. The second is the external shock: Governor Bullock has flagged the Middle East conflict and its effect on oil prices as a genuine supply-side complication layered on top of already-excess domestic demand, a dynamic Hauser has echoed, noting that a resolution and lower oil prices would be welcome but is not assured.

The Board's language has kept a tightening bias technically alive rather than shifting to neutral, and Bullock's August press conference reiterated that current pricing for near-term cuts is running ahead of the Board's own thinking. That gap matters well beyond AUD trading desks. Most Australian home loans sit on variable rates, so the 4.35 percent cash rate feeds directly into mortgage repayments, and the Board's next decision — whenever it comes — carries real weight for household budgets. Hauser's remarks today therefore offer a chance to signal whether persistent Gulf-driven oil price pressure and the incoming award wage increase are enough to keep the door open to a further hike, or whether the Board is content to let the current settings work through the economy for now. The September-quarter CPI print and the first WPI readings to reflect the award increase are the next scheduled data points that will test that "work to do" framing.

Source: investinglive.com