November rate rise more likely
Speculation of a rate rise in November has intensified with imports growing by 5.5 per cent in August, pushing the trade deficit for the month to $1.6.1 billion. Another indicator of the strong growth in the economy is an increase in Retail turnover of a higher than expected 0.7 per cent increase in August, contributing to an annual growth of 7.8 per cent. Sales of household goods were up by 2.4 per cent for the month, while food sales were up by 1 per cent. Financial markets now put the chance of a rate rise at the next RBA meeting at 37 per cent, but a rise in February is considered a 92 per cent probability and an increase by May is considered certain.