Received

The Reserve Bank is eyeing the pause button but another interest rate lift before Christmas is still firmly on the table.

In the minutes from the November board meeting, members opened the door to a rate hike breather to give its earlier handiwork a chance to take effect.

"The board is prepared to keep rates unchanged for a period while it assesses the state of the economy and the inflation outlook," they said.

But the central bank board noted inflation was still well above its target range of two to three per cent and "expects to increase interest rates further over the period ahead" to bring demand and supply back into balance.

Since May, the RBA has been lifting interest rates furiously to rein in inflation, which hit 7.3 per cent in the September quarter.

This included four larger 50 basis point hikes but it slowed its pace of tightening in October to 25bps and followed that up with another smaller hike in November.

In Tuesday's meeting minutes, board members also outlined the reasoning behind its 25bp interest rate hike.

The lagging impact of rate hikes was mentioned again, as well as the effect of cooling house prices on consumer behaviour.

"Previous episodes of lower housing prices and turnover had seen a large effect on consumer spending, in part through the wealth channel of transmission," the minutes said.

A return to a 50bp hike was discussed - especially in light of hotter-than-expected inflation in the September quarter - but board members said this could drag on confidence.

"The board agreed that acting consistently would support confidence in the monetary policy framework among financial market participants and the community more broadly," they said.

Still, board members have not ruled out returning to larger hikes if the situation calls for it.

Royal Bank of Canada economists said the communications were consistent with another 25bp hike in December.

Chief economist Su-Lin Ong and macro strategist Robert Thompson said the discussion about other central banks around the world "erring on the side of doing too much rather than too little" suggested the central bank was under pressure to do the same.

"This is likely to keep pressure on the RBA to move rates higher and firmly into restrictive territory like many of its global counterparts," they said.

Meanwhile, September quarter arrivals and departures data revealed a pick up in visitors to Australia.

But arrivals from China are still down 90 per cent on pre-pandemic levels, the data from the national statistics bureau shows, with other countries responsible for the rebound in visitor numbers.

ANZ economists note fewer arrivals from China, the largest and biggest spending market, will slow the recovery of Australia's tourism and education sectors.

Despite the softening of China's zero-COVID policy, it's expected to remain in place in some form for the short term.

Consumer confidence as measured by ANZ and Roy Morgan has lifted for the first time in six weeks.

A bump in the "future financial conditions'' gauge helped push up the weekly indicator by 2.7 per cent.

But consumer sentiment remains well below historical averages and has a long way to go to recover from the cumulative 10.4 per cent decline in the previous six weeks.

© AAP 2022

As Anthony Albanese prepares to meet Xi Jinping at the G20 summit in Bali, world leaders have been urged to prioritise unity and overcome division.

Indonesian President Joko Widodo is keen for the two-day summit to deliver outcomes, as the world grapples with rising inflation, climate change and the effects of the pandemic.

He called for unity and said collaboration is "badly needed" to save the world.

Mr Albanese has confirmed a sideline meeting with the Chinese president.

It is the first time since 2016 that leaders of Australia and China will have met formally and signals the start of decreasing diplomatic tensions.

Treasurer Jim Chalmers said while the meeting was a welcome opportunity, it would not immediately fix the fractured relationship between the two countries, or result in the removal of trade sanctions worth $20 billion.

"I don't think anybody pretends that some of the issues that China has raised, certainly some of the issues that we have raised, will be solved overnight," he told ABC radio.

"We give ourselves a much better chance where there's engagement and dialogue, and there will be today."

Dr Chalmers said the government remained deeply concerned over the detention of two Australians, including journalist Cheng Lei, who has been in custody for more than two years and denied contact with her family.

While Mr Albanese would not reveal what he planned to discuss with the Chinese president, he considered it a success that a meeting was taking place.

"For six years we have not had any dialogue, and it is not in Australia's interest to not have dialogue with our major trading partners," the prime minister told reporters in Bali.

"We will have a constructive dialogue. I will put Australia's position on a range of issues, and of course, Australia's positions on most of those is very well known."

The head of Australia's peak business group, in Bali for a meeting of industry groups, described the meeting as a "tremendous reset" with China.

"We've obviously had a set of difficulties in the relationship, but you can't fix those if you don't have a dialogue," Business Council of Australia chief Jennifer Westacott said.

"This creates an opportunity for businesses to come in behind that reset the prime minister has done and start building relationships."

Mr Xi met US President Joe Biden on Monday.

Mr Xi said he hoped they would "chart the right course for the China-US relationship" and he was prepared for a "candid and in-depth exchange of views".

Mr Albanese has also confirmed bilateral talks with British Prime Minister Rishi Sunak, French President Emmanuel Macron and Indian Prime Minister Narendra Modi.

Russia's invasion of Ukraine provides a backdrop to the summit, as Foreign Minister Sergei Lavrov attends instead of President Vladimir Putin.

Ukrainian President Volodymyr Zelenskiy is expected to attend virtually and address the summit.

Leaders at the G20 summit have taken part in a closed session on food and energy security.

with Associated Press

© AAP 2022

World leaders have been urged to prioritise unity and overcome division as the G20 summit officially kicks off.

Indonesian President Joko Widodo is keen for the two-day summit to deliver outcomes, as the world grapples with rising inflation, climate change and the effects of the pandemic.

He called for unity and said collaboration is "badly needed" to save the world.

Following his Indonesian counterpart's advice, Prime Minister Anthony Albanese has confirmed a sideline meeting with Chinese President Xi Jinping.

It is the first time since 2016 that leaders of Australia and China will have met formally and signals the start of decreasing tensions between the two nations.

Treasurer Jim Chalmers said while the meeting is a welcome opportunity, it won't immediately fix the fractured relationship between the two countries, or result in the removal of trade sanctions worth $20 billion.

"I don't think anybody pretends that some of the issues that China has raised, certainly some of the issues that we have raised, will be solved overnight," he told ABC radio on Tuesday.

"We give ourselves a much better chance where there's engagement and dialogue, and there will be today."

Dr Chalmers underlined the importance of lifting the tariffs.

"These trade restrictions are obviously not in Australia's interests, not in the interest of our employers and our exporters," he said.

"There's a sense of working together, where there is agreement, there is common ground, and I think that is a really, really important start."

Dr Chalmers said the government remained deeply concerned over the detention of two Australians, including journalist Cheng Lei, who has been held in custody for more than two years and hasn't been allowed contact with her family.

While Mr Albanese would not reveal what he plans to discuss with the Chinese president, he considered it a success that a meeting was taking place.

"For six years we have not had any dialogue, and it is not in Australia's interest to not have dialogue with our major trading partners," he told reporters in Bali.

"We will have a constructive dialogue. I will put Australia's position on a range of issues, and of course, Australia's positions on most of those is very well known."

The head of Australia's peak business group, in Bali for the B20 meeting of industry representatives, described the meeting as a "tremendous reset" with China.

"We've obviously had a set of difficulties in the relationship, but you can't fix those if you don't have a dialogue," Business Council of Australia chief Jennifer Westacott said.

"This creates an opportunity for businesses to come in behind that reset the prime minister has done and start building ... relationships."

Mr Albanese's meeting comes after Mr Xi met US President Joe Biden on Monday.

Mr Xi said he hoped they would "chart the right course for the China-US relationship" and that he was prepared for a "candid and in-depth exchange of views" with Mr Biden.

Mr Albanese has also confirmed bilateral talks with new British Prime Minister Rishi Sunak, French President Emmanuel Macron and Indian Prime Minister Narendra Modi.

Russia's invasion of Ukraine provides a backdrop to the summit, as Foreign Minister Sergei Lavrov attends instead of President Vladimir Putin.

Ukrainian President Volodymyr Zelenskiy is expected to attend virtually and address the summit.

The leaders have entered their first closed session on food and energy security.

with Associated Press

© AAP 2022