The surge of euphoria fuelled by the false belief the RBA had flagged an imminent reduction in the rate and number of future interest rate rises has proved to be very short lived.
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After jumping almost half a per cent after the announcement of the latest 25 basis point increase on Tuesday Australian share prices crashed back to earth on Wednesday.
This was due to a reality check in the form of a very hawkish statement by US Federal Reserve chair Jerome Powell overnight and a clearer understanding of the RBA's intentions following a speech by Dr Philip Lowe on Wednesday morning.
The roller coaster performance by the share market over the past two days was largely due to people hearing what they wanted to hear, not what was actually said.
Dr Lowe's Tuesday statement was unambiguous. After having been mauled for months for raising false hopes low interest rates would continue well into 2024 he wasn't going to make that mistake again.
"Further tightening of monetary policy will be needed to ensure that inflation returns to target ... the board remains resolute," he said.
Unfortunately, because the language was not as stark as in the February statement, some Pollyannas took this to mean the end was in sight.
That was why, addressing a key business summit on Wednesday morning, the governor hammered home the message the RBA would do whatever it took.
Asked why he had changed from a hawk to a dove in just one month Dr Lowe firmly denied the charge. He did note there had been "an abundance of data" in February compared to December/January and that this had been "softer" however.
"The underlying message is the same," he said. "Inflation is too high, we have to keep raising rates ... but as for how much and for how long - we are keeping an open mind.
"If we don't get inflation down there will [continue to be] higher interest rates, more unemployment and more pain ... it's a difficult time, it [the hardships being experienced by many] weighs heavily on my heart."
Dr Lowe defended the 10 straight interest rate increases.
He also drew a timely connection between the cash rate and the exchange rate following a fall of almost 2.2 per cent in the value of the dollar overnight.
"Just imagine if we had not raised rates [when we did]? Where do you think the exchange rate would be? Much lower," he said.
Could it be that even if the RBA did start to get inflation under control it might keep on raising rates to put a floor under dollar if other interventions failed?
The outlook for the Australian dollar is bleak given Jerome Powell has flagged the possibility of multiple 50 basis point increases in US interest rates.
There is a direct relationship between the value of our dollar against the greenback and the gap between the Australian and the US cash rates. The greater this becomes the further our dollar will fall.
That, given Australia's dependence on imported consumer goods due to the loss of sovereign manufacturing capacity, would have a significant inflationary effect.
The takeaway from all of this is that while the RBA governor's new found candour and openness with the public is very welcome he is doing his best not to raise false hopes.
His observation Australia is "closer" to a rate increase pause to reflect on the state of the economy is a truism akin to an outback farmer in a parched paddock under a cloudless sky after years of drought saying "at least we're one day closer to rain".
"When?" is the obvious question. "Only time will tell" is the equally obvious answer.
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