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Australia’s Central Bank
Australia's central bank left its benchmark interest rate at 4.1% at a policy meeting Tuesday after inflation fell to 5.6% in May from 6.5% a month earlier. The Reserve Bank has lifted the cash rate 12 times since May last year to reduce inflation to a target range of 2% to 3%. Higher interest rates raise the cost of borrowing for both businesses and consumers, slowing economic activity and helping to relieve price pressures that have flared after the slowdowns of the COVID-19 pandemic. Bank governor Philip Lowe said there might need to be further rises. Some further tightening of monetary policy may be required to ensure that inflation returns to target in a reasonable time-frame, but that will depend upon how the economy and inflation evolve, Lowe said in a statement. The decision to hold interest rates steady this month provides the board with more time to assess the state of the economy and the economic outlook and associated risks, Lowe added. In a report, Oxford Economics s
Australia's central bank boosted its benchmark interest rate on Tuesday for a seventh consecutive month to a nine-year high of 2.85 per cent. The Reserve Bank of Australia's decided on a second consecutive quarter-percentage-point rise in the cash rate at its latest monthly board meeting following four consecutive half-percentage-point hikes. When the bank lifted the rate by a quarter percentage point in May, it was Australia's first rate hike in more than 11 years. The cash rate is now at its highest point since May 2013, when the bank cut the rate from 3 per cent to 2.75 per cent. Reserve Bank Gov. Philip Lowe said in a statement inflation in Australia is too high, and his board expects to increase interest rates further over the period ahead. The bank remains resolute in its determination to return inflation to a target band of 2 per cent to 3 per cent by raising the cost of money, Lowe said. Inflation rose from an annual rate of 6.1 per cent in the June quarter to 7.3 per cent