Australian Bond Exchange Weekly Update
14th November 2025
Key Points
- Australia: The Reserve Bank of Australia (RBA) left the cash rate unchanged at 3.60% p.a. at its November meeting. The quarterly CPI for September gained 3.2% (YoY). The annual trimmed mean inflation in Australia — a key underlying inflation gauge used by the Reserve Bank of Australia — rose to 3.0% in the year to the September 2025 quarter, up from 2.7% in the June quarter.
- United States: The Federal Reserve cut its target cash rate by 0.25% to 3.75%–4.00% p.a. September headline inflation was 3.0% (YoY), up from 2.9% in August.
- United Kingdom: The Bank of England (BoE) held interest rates steady at 4.00% p.a. at its November meeting. September inflation stood at 3.8% YoY.
- Eurozone: The European Central Bank (ECB) has maintained its deposit rate at 2.0% p.a. Inflation in September increased slightly to 2.2% (YoY) — up from 2.0% in August.
Here are the latest monetary-policy and inflation figures for key economies:
| Region | Policy Rate | Latest Inflation (YoY) |
|---|---|---|
| Australia | Cash rate 3.60% p.a. (Reserve Bank of Australia, November 2025) | 3.2% to September 2025 (quarterly CPI indicator) |
| United States | Policy range 3.75–4.00% p.a. (Federal Reserve cut 0.25% on 29 October 2025) | 3.0% to September 2025 (CPI) |
| United Kingdom | Bank rate 4.00% (Bank of England) | 3.8% to September 2025 |
| Eurozone | Deposit facility rate 2.00% p.a. (European Central Bank held 11 September 2025) | Headline inflation ≈ 2.1% (ECB projected average for 2025) |
Market Insights
- A new wholesale investment opportunity
- Westpac-Melbourne Institute Consumer Sentiment Index surges 12.8% (YoY) in November
- Australian Public-Sector Wages Keep Pressure on Yields
- Fed Chairman’s recent quote – What do you do if you’re driving in the fog? You slow down.”
- BOE keeps rates steady at 4% p.a., with core and headline CPI still above the 2% target
Westpac-Melbourne Institute Consumer Sentiment Index surges 12.8% (YoY) in November
The Westpac–Melbourne Institute Consumer Sentiment Index surged 12.8%, rising from 92.1 in October to 103.8 in November.
Matthew Hassan, WBC Head of Macro-Forecasting, said: “This is an extraordinary and somewhat surprising result. November marks the first ‘net positive’ read on consumer sentiment in the best part of four years. Recall that an Index above 100 means optimists outnumber pessimists. This is the first time this has happened since February 2022.”
This marks a clear end to an extended period of consumer pessimism, when disposable incomes were being squeezed by high inflation, interest rates, and rising tax payments. The improved sentiment supports a positive Christmas spending outlook and reduces the likelihood of an RBA rate cut in the near term.
Australian Public-Sector Wages Keep Pressure on Yields
Public-sector wages continue to grow faster than private-sector pay, driven by new enterprise agreements and government wage settlements.
Public-sector employment grew by ~3.3% over the past year to reach around 2.6 million positions, mainly in health, education, and administrative services.
Total public-sector wages and salaries rose by ~7.6% in the 2024–25 financial year, reflecting workforce expansion and higher pay rates.
While wage pressures are moderate relative to peak-inflation periods, strong public-sector wage growth is contributing to underlying labour-cost momentum and weighing on productivity — which adds upward pressure on yields.
Fed Chairman’s recent quote – “What do you do if you’re driving in the fog? You slow down.”
Federal Reserve Chair Jerome Powell recently used the analogy of “driving in a fog” when describing the Federal Reserve’s current policy environment, stating that when visibility is limited, “you slow down.” Powell made the comment following the Federal Reserve’s 25-basis-point rate cut in late October 2025.
He noted that the U.S. government shutdown has restricted access to several official economic data releases, and as a result, the Federal Reserve is referring to a narrower range of private-sector indicators. Powell stated that the situation requires careful assessment due to the reduced availability of government data.
BOE keeps rates steady at 4% p.a., with core and headline CPI still above the 2% target
Recent U.K. inflation data shows that several regulated cost categories, including energy, water and council tax, have increased in recent months. These components contribute to household expenditure and have remained elevated even as some internationally driven price pressures have moderated. The movement in regulated prices forms part of the broader inflation composition monitored by the Office for National Statistics (ONS).
Data released by the ONS on Tuesday reported that the U.K. unemployment rate increased to 5.0% in the three months to September, compared with 4.8% in the three months to August. The ONS noted that this period also saw changes in employment levels and labour-market flows, reflecting ongoing adjustments in the job market.
Wage growth excluding bonuses measured 4.6% in the three months to September, compared with 4.7% in the previous period. This data is part of the ONS’s regular labour-market reporting and provides insight into earnings trends across sectors.
Regulated price movements, unemployment statistics and earnings data form part of the information set assessed by policymakers and market participants when analysing economic conditions in the United Kingdom. The reported figures reflect the most recent publicly available information from the ONS.
A new wholesale investment opportunity is scheduled to be made available
The Zagga Group is issuing new Senior Secured Note to replace the existing one which expires at the end of November (indicative terms for the new Note are BBSW+4.20% p.a. coupon, for 4 years. wholesale clients only).
Zagga was established in 2016 and is a leading Australian alternative real estate investment manager committed to delivering attractive, risk-adjusted investor returns, and tailored private credit solutions, across the capital stack.
Zagga provides lending primarily in Australian capital cities and nearby regional areas. Its portfolio has a strong presence in greater Sydney, with additional activity in Melbourne and other eastern seaboard markets.
Zagga has originated over 300 loans for $2.3bn+, with only 6 enforcements and over 200 successful exits, resulting in a full return of investor capital. Loans are secured by first registered mortgages over non-specialised property assets.
These may includes:
- Land intended for residential use
- Completed apartments
- Generic commercial real estate
- Construction and development loans
For further information about this opportunity, speak with your financial adviser.
*Data accurate as at 14.11.2025
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