According to Jinshi, Fitch Ratings predicts that the Australian economy may only grow by 1.2% this year, affected by restrictive monetary policy and sticky inflation. The agency pointed out that the sharp downward revision of the household savings rate in the latest GDP data shows that consumers have less room to use their accumulated savings than previously thought. Inflation in Australia has been tricky, with the overall inflation rate of 3.6% in the first quarter, higher than the RBA's expectations, and is likely to remain a key theme. Fitch currently expects the RBA to only cut interest rates by 25 basis points in November, and from the balance of risks, policy easing tends to start in 2025.
