Economists from Goldman Sachs Group Inc. to Commonwealth Bank now predict the Reserve Bank of Australia (RBA) will raise interest rates as early as September, abandoning previous expectations of a hold through year-end. The shift follows Wednesday's consumer price index (CPI) report showing persistent price pressures. Minutes from the RBA's August meeting revealed the board has low tolerance for elevated inflation, reinforcing the hawkish pivot.

Markets are pricing in a higher probability of a 25 basis-point increase next month, marking a significant turnaround from earlier forecasts that the tightening cycle had peaked.