If you own ASX shares you'll want to be paying attention this week.
These are the three biggest things to keep an eye on, according to eToro market analyst Josh Gilbert:
1. RBA interest rate decision
It's on again.
The board of the Reserve Bank is meeting on Tuesday afternoon to once again decide whether more pain is coming for mortgage holders, businesses and investors.
The experts are divided this time round as to whether interest rates will head up or be kept on hold.
A survey conducted by comparison site Finder last week showed that 51% of economic gurus tipped a rate rise, while 49% thought the RBA would hold.
Gilbert is on the pessimistic side.
"Given [RBA governor] Philip Lowe's aggressive take on inflation so far in 2023, I'd be surprised to see anything but a hike," he said.
"The cash rate currently stands at 4.1%, but the RBA's hawkish bias looks set to see another 25-basis-point hike next week."
There is a bright side, though, with inflation coming down from 6.8% in April to 5.6% in May.
"The good news is that markets are already pricing in another two hikes from the RBA," said Gilbert.
"We're unlikely to see a higher cash rate than 4.6% unless inflation and other data points stall significantly in the months ahead."
2. Will Taylor Swift inflame inflation in Australia?
Last week Australians waited for hours in front of their computers to buy tickets for the upcoming Taylor Swift tour.
The hype reminded Gilbert of the good old times.
"The buzz harks back to the pre-pandemic era when live shows were a major part of the entertainment industry and a significant contributor to consumer spending and state tourism," he said.
"Despite monetary struggles, consumers clearly aren't willing to give up travel and experiences after the pandemic took them away for so long."
But he warned that this enthusiasm could prolong the current battle with high inflation, as seen in Sweden last month when Beyonce Knowles toured.
"Bey's May concert caused such a demand for hotels and restaurants that it influenced Sweden's inflation for the month, which came in higher than expected at 9.7% due to the rising prices of hotels and restaurants to cater to concertgoers' demand.
"With Taylor being a performer of a similar calibre, local inflation could be in for a Swift-sized bump."
3. Retail investors are still keen on ASX shares
Despite steeply rising interest rates, punters are still bullish on stocks.
Gilbert cited how a recent eToro survey found that 26% of retail investors increased the amount of money regularly put into their portfolio over the last three months. This is while just 11% put in less.
"The picture is similar over the next three months, with 31% planning to up contributions while 10% say they will reduce them," he said.
"Tech stocks have been the place to be this year, and retail investors are sticking with their long-standing bullishness, reflecting their younger and digital native roots."
Artificial intelligence has also drummed up hype "not seen for years".
"Retail investors are excited about what's ahead."
