Q3 CPI Today

• Attention turns to the Australian monthly and quarterly CPI release at 11:30am this morning, with the policy-relevant trimmed mean expected at 1.0% for the quarter and 3.6% over the year. The release is the last key piece of data before the RBA decision next week.
• The cash rate has been hiked four times this year to sit at 4.60%, although its path from here remains uncertain. Markets are pricing a 65% chance of a hike at next week’s meeting, but any softness in the CPI data could see this repriced, particularly following the softer employment data.
• Oil edged lower overnight to US$114/bbl as tentative signs of de-escalation in the Middle East supported risk sentiment, with reports suggesting Iran had discussed conditions for ending the war amid diplomacy from Saudi Arabia, Pakistan and Turkey.
• The Fed is widely expected to hold the target range at 3.75% to 4.00% at its meeting tomorrow morning Sydney time, with markets instead looking to the December meeting, where a hike is priced at 90%.