Economic Commentary

March 1, 2026

Too much demand, not enough economy.

Key points:

• The economy looks to have maintained much of the momentum gained through mid-2025 and the unemployment rate remains low.
• A number of indicators point to the economy running up against capacity constraints and there is a risk that inflation pressures persist.
• With underlying inflation expected to track above 3% for most of 2026, we see the RBA lifting rates to 4.1% in May.

For further details, please refer to the attached (PDF, 1MB).