Week ahead: Will the Reserve Bank of Australia increase its rates this month?

February 6, 2023

The upcoming week will bring much anticipation for the financial community as the Reserve Bank of Australia (RBA) is set to announce its latest monetary policy decision. The central bank has been on a streak of consecutive rate hikes, but speculation has been brewing about whether or not it will continue this trend. 

With the economy showing signs of growth and inflation pressures on the rise, many are asking: will the RBA raise rates this month?

Here are the key market events for the week ahead:

RBA Rate Statement (7 February)

The RBA raised the cash rate by 25bps to 3.1% in its last meeting of 2022, its eighth consecutive hike. 

Analysts anticipate RBA to increase rates by 20bps to 3.3% this month.

UK Monthly Gross Domestic Product (GDP) (10 February)

The British economy saw a growth of 0.1% in November, a decrease from October’s 0.5%. 

Analysts predict a 0.1% decrease in the UK (GDP) for December 2022. 

Canada Employment Change (10 February)

The Canadian economy saw the creation of 104,000 jobs in December 2022, with an unemployment rate of 5%, the lowest since hitting a record-low of 4.9% in June and July. The unemployment rate dropped from 5.1% in November. 

Analysts forecast a smaller increase of 15,000 jobs in January and a slightly higher unemployment rate of 5.2%.

US Prelim University of Michigan Consumer Sentiment (10 February)

The University of Michigan consumer sentiment for the US was revised upward to 64.9 in January 2023, the highest it has been since April 2022, from a preliminary reading of 64.6. 

Analysts anticipate the data to be around 65 for this month.