Analyst consensus is for the rates to stay at 3.00%. However, traders think that economic fundamentals have significantly improved, enough to warrant rising rates. It could be the first G-20 central bank to raise rates since the financial crisis started.
Here is today's chart of all currencies we track live (as of 3PM):
(please click to enlarge)
Clearly, the AUD and BNZ are on a tear.
With the U.S. Dollar still weakening, this could be a suicidal move as it would further boost the Aussia currency, and further damage exports. Maybe the bank down under knows something we don't. However, Australian unemployment numbers are supposed to be released only on Wednesday. Surely, they would need to take this into consideration before raisng rates. The stakes are high.
Straddles for December (a little illiquid):