TREE NEWS update: Reserve Bank of Australia Governor Bullock said the bond market’s reaction has been orderly but the central bank is monitoring it closely, adding that it considered both holding rates and a 25 basis point hike. She said one upside inflation risk has emerged and two more are building, with inflation pressures from the AI boom accumulating, making the current situation very difficult.
RBA’s Bullock: Bond Market Reaction Orderly, Watching Closely
The significance here is less the bond market's calm than the RBA's own framing: an explicit live debate between holding and hiking, alongside a rising count of upside inflation risks. Naming the AI boom as an accumulating price pressure is a notable shift, tying a technology investment cycle to monetary policy rather than treating it as a standalone growth story. For markets, the question is whether that risk tally keeps climbing and forces a tightening the RBA clearly does not want to deliver into an orderly bond market.
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