Another rate cut on Melbourne Cup day appears to be a long shot

Photo by Mark Metcalfe/Getty Images for the VRC

If financial markets are anything to go by, the odds of another rate cut on Melbourne Cup day appears to be a long shot.

Following the release of Australia’s Q3 consumer price inflation (CPI) report earlier today, cash rate futures have wasted no time in pricing out the likelihood of a November 1 rate cut, putting the probability at just 4%.

Nada, nothing. You’d have better odds picking the winner in the $5 sweep on Cup Day than seeing the RBA cut rates.

It had been as high as 14% before the CPI report was released, and was regarded as a one-in-three chance at the start of October.

Before the today’s release, 20% of economists polled by Bloomberg were forecasting a 25 basis point rate cut next week.

It will be interesting to see if any have tweaked that view following the CPI release.

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