Never a guarantee

Hopes for a nice easing into the new financial year were dashed early this month when the Reserve Bank of Australia (RBA) opted against cutting the interest rate and keeping it at 3.85%.

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It was a decision that shocked many, including the bulk of economists and other experts who were certain we'd see a reduction in July, followed by another in August. In fact, the market was so convinced that it had priced in a roughly 90% chance of a trim.

Factors such as the tight labour market, and continued uncertainty, including stemming from US tariffs, contributed to the call. The RBA also cited the lag in seeing the effects of monetary policy decisions, saying it was still too soon to confidently say inflation is sustainably tracking to where we want it.

Naturally, it took little time at all for RBA governor Michele Bullock to become a target, including copping questions around whether the RBA is really being as transparent and informative about its thinking and decision-making processes as it has endeavoured to be.