Inflation in Australia showed signs of cooling in November, with the headline consumer price index (CPI) increasing by 4.3 percent over the 12 months to November, down from 4.9 percent in October, as reported by the Australian Bureau of Statistics. This figure came in just below the market forecast of 4.4 percent.

The significance of this data lies in its potential impact on the Reserve Bank of Australia's (RBA) monetary policy decisions. As the RBA prepares for its meeting in February, this inflation update serves as the final major economic indicator. Despite the slowdown, some economists maintain that the RBA may need to implement another rate hike to address persistent inflation within the services sector.

In response to the slowing inflation, traders around the world have been increasing their bets on rate cuts in the US and other regions, anticipating that central banks have sufficiently acted to curb inflationary pressures. In the Australian context, the markets have assigned a mere 3 percent probability of an interest rate rise in the upcoming month, with a rate reduction fully anticipated by August.

Looking ahead, the RBA is set to reconvene on February 6 following its summer hiatus. The central bank last implemented a rate increase in November.