Sydney, Jan 29, 2026, 17:20 AEDT — The market has closed.
- ANZ shares ended 0.11% higher at A$36.44, reflecting traders’ updated bets on interest rates
- Markets now see a February rate hike as the most likely move, driven by hotter core inflation.
- All eyes shift to the RBA’s February 3 decision and its implications for inflation risks
Shares of ANZ Group Holdings edged up 0.11% to close at A$36.44 on Thursday. The stock fluctuated between A$36.17 and A$36.56 amid changing rate forecasts after an inflation surprise. It remains well off its 52-week peak of A$38.93.
This shift is significant since Australian bank shares have been locked onto the direction of the cash rate. Even a slight tweak in forecasts can ripple through the sector, given how tightly banks’ profits depend on lending margins and funding expenses. The Reserve Bank of Australia is set to meet next week.
Data on Wednesday revealed trimmed-mean core inflation — which excludes the largest price changes — climbed 0.9% in the December quarter. That pushed the annual rate up to 3.4%, well above the central bank’s 2%-3% target range. Markets quickly priced in over a 70% chance of a 25 basis point rate hike. Financial stocks dipped 0.5%, with Commonwealth Bank of Australia sliding 0.8%.
Just a day earlier, ANZ’s take was noticeably calmer. Economist Sophia Angala highlighted that weekly inflation expectations had softened. The bank’s trimmed-mean inflation forecast suggested the RBA would likely hold the cash rate steady at 3.60% in February.
Westpac chief economist Luci Ellis struck a firmer tone after the CPI data, saying inflation results “get the casting vote” when the economy is close to full capacity. She predicts the RBA will raise the cash rate by 25 basis points to 3.85%, viewing “a single hike” then a pause as her baseline scenario. Westpac IQ
ING’s Deepali Bhargava favors a rate hike, citing persistent inflation in housing and services. She described a February increase as the path of least resistance. Bhargava expects the central bank to take “a cautious one,” weighing stubborn prices against uneven growth signals. ING THINK
ANZ is overhauling its cost and space setup beyond just interest rates. The bank plans to consolidate its Singapore workforce at the Marina One complex in late 2026 when its current lease ends, according to sources close to the matter. A memo seen by Bloomberg revealed the move aims to create a shared workspace “to better support how we work today and into the future.” The Straits Times
ANZ released some subdued corporate news on Thursday, revealing its institutional division snagged the title of best corporate bank in Asia for relationships—for the ninth year running—in a Coalition Greenwich study. Managing Director International Simon Ireland highlighted the award as a nod to “quality service” and promised continued investment in “people and platforms.” exclusives.anz.com.au
Friday’s trading will probably hinge on bond yields and upcoming moves in cash-rate futures, not on bank-specific news. The banking sector is once again acting as a stand-in for rates, dragging ANZ along for the ride.
The rate story is a double-edged sword for lenders. Should the RBA pause or suggest inflation fears are easing, the steep hike pricing could reverse swiftly; but if it raises rates and signals more hikes ahead, any margin gains might be undercut by fresh concerns over stressed borrowers and rising bad-debt provisions.
Tuesday brings the next key event: the RBA will announce its cash rate target at 2:30 p.m. AEDT on Feb. 3. ANZ investors will be focused on the statement, especially for shifts in language around ongoing inflation and the possibility of further hikes.
