Consumer inflation in Australia cooled slightly year over year in November, but there was little change in market sentiment. Traders continue to reflect the probability that the Bank of Australia will raise interest rates by 35% to 40% in February, while the market has basically fully reflected the possibility of two rate hikes before the end of the year. With inflation still above target levels, most market participants are waiting for the fourth quarter CPI data to be released at the end of this month, as the Bank of Australia is likely to take this data seriously as well.

Consumer inflation in Australia cooled slightly year over year in November, but there was little change in market sentiment. Traders continue to reflect the probability that the Bank of Australia will raise interest rates by 35% to 40% in February, while the market has basically fully reflected the possibility of two rate hikes before the end of the year. With inflation still above target levels, most market participants are waiting for the fourth quarter CPI data to be released at the end of this month, as the Bank of Australia is likely to take this data seriously as well.