Goldman Sachs and Deutsche Bank forecast Reserve Bank of Australia on hold next week

Summary:All four major Australian banks now expect a 25bp RBA rate hike next Tuesday, following a stronger-than-expected Q4 inflation outcome. The shift contrasts with Goldman Sachs and Deutsche Bank, which continue to call for a hold. A hike would make the RBA the first non-Japan G10 central bank to raise rates in the current global easing cycle. That outcome has pushed markets and local economists to reassess the central bank’s easing bias. Goldman Sachs and Deutsche Bank remain among the minority calling for policy to remain on hold.