Reserve Bank of Australia statement coming up at 0430 GMT on Tuesday 03 May 2022. I posted earlier on the RBA:

Justin had this:

A few snippets from non-Aussie banks

Standard Chartered

  • We expect the central bank to lift its policy rate from emergency levels of 0.10% to 0.25%.
  • We think the latest high inflation print (Q1 trimmed mean rose to 3.7% YoY, well above the central bank’s target range of 2-3%) may mean that the RBA needs to move earlier, but not necessarily by a full 25bps, in May.
  • Thereafter, we expect the central bank to hike 25bps per meeting from June through to December, taking the policy rate to 2% by year-end.

ING

  • What was shaping up to be just a position-setting meeting ahead of an actual hike later this quarter is now looking likely to deliver not just a rate hike, but perhaps a 40bp one together with a strong nod towards front-loading at subsequent meetings. This follows a much higher-than-expected inflation reading for 1Q22. The market is already heavily pricing in rate hikes from the RBA so the market reaction may be modest.”

TD

  • After the red-hot inflation print ... a very close call but for now we maintain our view of no hike.
  • We don't expect the RBA to hike in an election month, and it could wait for Q1 wages print on 18th May to justify a June hike given its focus on wages growth. However, the risk for a 40bps hike in June is likely higher if wage growth surprises to the upside.

Société Générale

  • We expect the RBA to increase the cash rate target from 0.10% to 0.25%.
  • The RBA is likely to acknowledge that underlying inflation significantly deviated from the 2-3% target range in 1Q22, and to say that it will set policy to support inflation outcomes consistent with the target. In other words, policymakers will become decisively hawkish, suggesting a fast pace of rate hikes in the near-term.

Citi

  • The RBA is expected to raise the cash rate by 15bps, from 10bps to 25bps. Risk is that the Board could consider a 40bp increase (in line with market pricing), but we expect a follow-up 25bp rate hike in June, which should negate the reason to lift by 40bps this week.
  • The other risk is that the Board may delay the hike to June because it’s waiting for Q1 WPI and National Accounts. Balance sheet roll-off – the Board will likely allow maturing bonds to roll-off its balance sheet, rather than reinvest maturities.

FWIW I think the RBA will hike 15bps today. It would be stupid not to hike by this small amount. Which, I think the Bank will admit, but they'll say 'least regrets', not 'stupid'.

RBA Governor Lowe