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IMF Backs Further RBA Rate Hikes as Inflation Persists, CBA Says

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The International Monetary Fund (IMF) backed further interest-rate increases by the Reserve Bank of Australia (RBA) as persistent inflation pressures and higher energy costs threaten to keep inflation elevated, Commonwealth Bank of Australia (ASX:CBA) said in a Thursday note.

The IMF warned that rising global energy prices could fuel inflation expectations, urging central banks to consider rate cuts only if growth weakens significantly and inflation is clearly under control, per the report.

It also called for more ambitious productivity reforms, including stronger competition, reduced regulation, greater infrastructure investment and tax changes such as replacing stamp duty with land tax.

On housing, the fund welcomed government measures including changes to property investor tax incentives and increased support for build-to-rent, social and affordable housing.

The IMF said Australia's artificial intelligence and data-center boom could support economic growth and productivity, while warning that rising electricity demand and construction pressures could fuel inflation if renewable energy investment does not keep pace.

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International

New Zealand Job Ads Rise 0.6% in August, Up 9.7% Annually, Says Seek

New Zealand job ads rose 0.6% month on month in August and are 9.7% higher year on year, with applications per job ad rising 0.9% month on month despite the increase in available opportunities, according to a Thursday report by Seek.The report said 4% of job ads reference artificial intelligence skills, with mentions rising 4.4% month on month and over 93% year-on-year, while job ads with high-automation exposure are now 0.1% lower year on year as those with medium or low exposure continue to rise.Several regions are recording double-digit annual growth, including West Coast at about 25%, Otago at roughly 19%, and Canterbury at nearly 16%, while Manawatū, Hawke's Bay, Northland, and Taranaki were the only regions where job ads declined month-on-month, the report added.The consumer services sector also grew significantly, led by hospitality and tourism at 3.4% and retail and consumer products at 3.3%, per the report.Seek NZ country manager Rob Clark said Auckland enjoyed exceptional monthly growth in August, growing at its fastest pace in over four years, driven by increasing demand for manufacturing, transport, tourism, and hospitality workers.

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International

Saudi Central Bank Lifts Rates by 25 Basis Points

The Saudi Central Bank on Wednesday decided to hike key rates by 25 basis points to maintain monetary stability.SAMA raised the repurchase agreement, or repo rate, to 4.50% and the reverse repo rate to 4%.The move follows the US Federal Reserve's decision to lift interest rates by 25 basis points.

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International

UAE Central Bank Hikes Rates by 25 Basis Points in September

The Central Bank of the United Arab Emirates raised the base rate applicable to the overnight deposit facility by 25 basis points to 3.9%, effective Thursday.Meanwhile, the interest rate applicable to borrowing short-term liquidity was maintained at 50 basis points above the base rate for all standing credit facilities, according to a Wednesday release.The CBUAE's decision follows the US Federal Reserve's move to increase the interest rate on reserve balances.

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