Although the RBA predictably left rates on hold at its meeting this week, it did soften its hawkish bias a touch. And with the latest CPI data pointing to a noticeable slowdown in underlying inflation this quarter, we've brought forward our forecast for the Bank's first rate cut from May to February. For their part, markets are betting that the RBA will start cutting rates even before the year is up. However, that timeline seems a bit too optimistic to us given the tightness of the labour market currently.
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