Hauser’s Tuesday evening comments keep a September rate hike firmly on the table across Australian rates, currency and equity markets, even though he avoided calling it a certainty. The Australian dollar is the most direct read-through, with a clearer tightening bias typically supportive for the currency against major peers, while Australian Commonwealth Government Bond yields, particularly at the shorter end, may edge higher as traders price in a greater chance of a move this month. The ASX, and rate-sensitive sectors such as banks, real estate investment trusts and consumer discretionary names in particular, could see some pressure if the market leans further into a hike scenario, given higher borrowing costs typically weigh on valuations in those areas. With the RBA already at 4.35 percent after three hikes earlier this year and the four major banks pencilling in a further quarter point move to 4.6 percent by year end, traders are likely to treat Hauser’s remarks as confirmation of a live tightening bias rather than new information. The comments came alongside similar remarks from Assistant Governor Sarah Hunter earlier the same day, reinforcing a consistent tightening message from RBA leadership just ahead of the September board meeting, and because the next inflation print lands only after that meeting, on September 30, bond and equity markets have limited fresh data to lean on in the interim, leaving Hauser’s tone as one of the more direct signals available.
Summary
- Speaking to ABC’s 7.30 on Tuesday evening, RBA Deputy Governor Andrew Hauser said inflation is the central bank’s “one big problem”, acknowledging public anger over the cost of living
- He pointed to a three-headed monster driving persistent inflation: the Middle East crisis, an AI-driven global boom, and weak domestic supply capacity
- Hauser gave a strong signal the RBA is weighing a rate hike this month but declined to call it inevitable, saying the question is whether enough has been done
- The RBA raised rates three times in early 2026 to the current 4.35 percent; the four major banks expect a further quarter point rise to 4.6 percent by year end
- The board meets at the end of September, with new inflation data due only the day after that decision, on September 30
- Hauser’s comments, made Tuesday evening, followed similar remarks hours earlier that day from Assistant Governor Sarah Hunter, who said the RBA may have to raise rates further if inflation runs hotter than forecast
Reserve Bank of Australia Deputy Governor Andrew Hauser gave one of the clearest signals yet that the central bank is weighing another interest rate increase this month, telling ABC’s 7.30 program on Tuesday evening, Australia time, that inflation remains the RBA’s central concern even as the broader economy holds up reasonably well. Hauser acknowledged widespread public frustration over the cost of living, saying inflation is unfair because it hits lower income households hardest and complicates business decisions, and that “People are furious about inflation.”
Hauser described persistent price pressure as being driven by what he called a three-headed monster: the ongoing Middle East crisis, an unexpectedly strong AI-driven global investment boom, and constraints on the supply side of the Australian economy. He said the central bank could raise rates sharply if it chose to prioritise inflation over its full employment objective, but that Australia is not at that point yet. Pressed on whether a hike this month was inevitable, he declined to say so directly, instead framing the decision as an open question for the board about whether enough tightening has already occurred.
The RBA lifted the cash rate three times in early 2026, taking it to its current level of 4.35 percent, after judging that demand was running ahead of the economy’s supply capacity by more than expected. Australia’s four major banks are forecasting a further quarter point increase to 4.6 percent before the end of the year. The board’s next decision falls at the end of September, with the closely watched quarterly inflation data not due for release until the day after that meeting, on September 30, leaving policymakers to weigh the decision with an incomplete data picture.
Hauser’s Tuesday evening remarks followed comments made earlier that same day by Assistant Governor Sarah Hunter, who said the central bank may well have to raise rates further if it judges inflation to be running hotter than its forecasts suggest, reinforcing a consistent message from RBA leadership ahead of the meeting. Hauser also touched on the housing market, saying he expects prices to fall a little further but that the downturn is not a major driver of the bank’s broader forecasts, and reflected on a recent US trip that left him more concerned about global inflation risks given the scale of AI-related investment he witnessed, while questioning whether current valuations in the sector are realistic. Taken together, the comments point to a central bank prepared to keep tightening if needed, but still weighing the decision carefully on Tuesday evening rather than treating a September move as settled policy.
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2026 Reserve Bank of Australia meetings:
This article was written by Eamonn Sheridan at investinglive.com.