The global economic and financial backdrop is changing on a weekly basis at the moment.
In particular, the slowdown in China appears sharper than expected requiring stimulus from their central bank. In contrast, the continued expansion in the US is leading the US Federal Reserve to cut back on its stimulus and lift its guidance on future interest rate rises.
Locally, the recent positive economic data has continued to reduce market expectations of further rate cuts. The cash rate futures have indicative pricing for the official cash rate over the next six months currently at 2.46%, compared to the cash rate of 2.50%, a totally different picture to a month earlier (refer chart below).