MUFG: THE IMPASSE IN THE STRAITS OF HORMUZ AND THE POSITION OF THE TROMPHAWK CONTINUE TO RAISE THE RBA INTEREST RATE RISK

MUFG STATED THAT THE IMPASSE IN THE STRAITS OF HORMUZ AND THE HAWK POSITION OF TRUMP LEFT THE AUSTRALIAN RESERVE BANK (RBA) WITH INTEREST RATE RISK. ACCORDING TO MUFG, RBA IS CURRENTLY FACING EXTERNALLY DRIVEN INFLATIONARY SHOCKS RATHER THAN DOMESTIC INFLATION, WHICH HAS CHANGED THE SPEED OF POLICY RESPONSE. ALTHOUGH RBA COMMUNICATION APPEARS TO BE LESS EAGER TO RAISE INTEREST RATES, THE MARKET HAS ALREADY STARTED PRICING THE RISK, AND IT IS EXPECTED THAT THERE WILL BE AN INCREASE BY MARCH NEXT YEAR. ACCORDING TO MUFG, IF ENERGY PRICES RISE SIGNIFICANTLY, RBA MAY AGAIN INCREASE INTEREST RATES IN SEPTEMBER, BUT THERE IS NO SENSE OF URGENCY。