Australia's economic calendar this week centres on two releases that will shape expectations for the Reserve Bank of Australia's (RBA) next policy move: the minutes of the September policy meeting, due Tuesday, and the September labour force survey, due Thursday. Both will be published at 11:30 am Sydney time (00:30 GMT, or 8:30 pm ET the previous evening). Together, the two releases will test whether the central bank's tightening cycle has further to run.

For the Australian dollar and front-end rates — the short-dated yields most sensitive to shifts in policy expectations — the minutes carry more weight than usual because Governor Michele Bullock's post-meeting tone was softer than the decision itself. If the record leans toward holding, it would support pricing for a pause and could weigh on the currency; if it keeps further tightening clearly on the table, it would reinforce Westpac's call for another move by year-end. Oil is the swing factor behind both outcomes: the board explicitly cited Middle East pressure on fuel prices, so any renewed crude strength from Gulf attacks would harden the inflation case. An upside surprise in unemployment, meanwhile, would sharpen the market's focus on downside risks to growth.

Fourth Hike of the Cycle

The RBA's Monetary Policy Board lifted the cash rate by 25 basis points to 4.60% at its September meeting, a unanimous and widely expected decision that marked the fourth hike of the cycle. The board said inflation remained too high, pointing to domestic capacity pressures alongside global shocks from the Middle East conflict and the AI investment boom. It acknowledged that the economy was slowing and the labour market was loosening, but not quickly enough to return inflation to the RBA's 2–3% target band within a reasonable timeframe, especially with renewed pressure on oil prices.

CBA and Westpac Diverge on the Path Ahead

CBA says the minutes should shed light on the arguments for holding rates steady, and it will be watching whether they match the more dovish tone Bullock struck at her press conference, when she noted that the four hikes would take time to flow through. CBA views the hurdle for another increase as now higher. Westpac takes a firmer line, forecasting one more hike to 4.85% by December, and says markets will look to the minutes for guidance on the outlook.

Consumer Sentiment Slumps After the Hike

The September hike has already hit households. Westpac's consumer sentiment index fell 4.7% to 80.4 in October, near the weakest levels in the survey's history, with confidence among respondents surveyed after the decision far below those polled before it.

Jobs Report in Focus on Thursday

Thursday's labour force report follows a surprise jump of around 40,000 in employment in August that nevertheless pushed the unemployment rate up to 4.6%, the highest since late 2021, as participation rose to 67.1%, just below its record high. With full employment sitting alongside price stability the RBA's mandate, the unemployment rate is among the indicators the board weighs most closely.

Westpac forecasts a 20,000 rise in employment for September, in line with consensus, with participation easing to 67.0% and unemployment steady at 4.6%. The bank says cost-of-living pressures and higher interest rates are drawing more people into the workforce, keeping labour supply ahead of demand.

CBA expects a smaller gain of 10,000, noting its own internal data had pointed to jobs growth closer to 20,000 a month, and also sees unemployment at 4.6%. It warns the print could be noisier than usual: a survey group with a very low jobless rate is rotating out of the sample — an upside risk — while August's rise may have been overstated and could partly reverse. CBA cautions against reading any fall in unemployment as a change in trend, expecting the rate to drift higher as the economy slows.

Business Conditions Weaken

Elsewhere, the National Australia Bank (NAB) business survey, a monthly read on trading conditions, profitability and hiring across firms, is also due on Tuesday and follows August's slide in business conditions into negative territory for the first time in six years. The release will offer a timely read on whether the economic slowdown acknowledged by the RBA is deepening.

Four hikes in, the question for Australia this week is whether the RBA's resolve or its Governor's softer words better describe where policy goes next.