## Calculations for ASX Target Rate Tracker (Based on 30 Day Interbank Cash Rate Futures)The expectation of a rate change by the RBA is calculated by taking into account the number of days the RBA Target Cash Rate is known versus the number of days in the month that it is unknown ie: the number of days before and after the RBA Board Meeting. By incorporating this time factor into a probability equation the following formula can be used to determine current market expectations on whether or not the RBA will change the Target Cash Rate: r Solve for p, where: p = probability of rate change X = current yield on 30 Day Interbank Cash Rate Futures
r r n n |