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RBA’s Chief Unsure if More Rate Hikes Needed to Tame Inflation
Bullock said policymakers are prepared to raise rates again if needed as domestic demand eases and firms face higher cost pressures.
- On Tuesday, Reserve Bank Governor Michele Bullock warned that underlying inflation remains too high and policymakers are prepared to raise interest rates again if necessary to return inflation to the 2-3% target band.
- Recent Middle East conflict has spurred oil price volatility, threatening to keep underlying inflation elevated as fuel costs flow through the economy, though Bullock noted the labor market eased slightly over recent months.
- Following three increases earlier this year, the Reserve Bank Board maintains the cash rate at 4.35%. Money markets show a 28% chance of a rate hike in August, with further tightening fully priced by December.
- Officials await key June inflation data arriving on Wednesday to inform the next decision on August 11. The Board remains focused on keeping inflation expectations anchored to prevent shocks from causing lasting price increases.
- Bullock emphasized that persistent weak productivity growth and a weaker-than-forecast housing market constrain the economy's ability to grow without generating further inflation. These structural challenges limit the central bank's monetary policy options.
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11 Articles
11 Articles
RBA's chief unsure if more rate hikes needed to tame inflation
·London, United Kingdom
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RBA's Bullock Says Economy Cooling, Unsure If Rates High Enough
Australia’s central bank chief said there are signs the economy is adjusting as anticipated, though it’s still unclear if this year’s interest-rate hikes are enough to return inflation to target or whether additional tightening will be needed.
·Toronto, Canada
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Coverage Details
Total News Sources11
Leaning Left1Leaning Right4Center2Last UpdatedBias Distribution57% Right
Bias Distribution
- 57% of the sources lean Right
57% Right
14%
C 29%
R 57%
Factuality
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