Sydney: Australia’s Supreme Central Bank Governor said today (Feb 17) that further interest rate hikes are needed in the coming months to ensure that very high inflation returns to the 2% to 3% target range. I repeated that there was
Reserve Bank of Australia (RBA) Governor Philip Lowe told lawmakers whether further interest rate hikes were needed would depend on developments in the global economy, trends in household spending, inflation and the outlook for the labor market. rice field.
“Based on the information currently available, further increases are needed over the coming months to ensure that inflation returns to target, and this period of high inflation is only temporary,” Lowe said. The meeting is expected,” he said.
“We will do what is necessary to bring inflation back into our target range,” he said.
The central bank last week raised interest rates by a quarter of a percentage point to a 10-year high of 3.35%, bringing its tightening to 325 basis points since last May. It also compounded the blow by warning that more upside is needed to contain inflation, which has remained at a 30-year high.
The market has raised its rate cap forecast to around 4.1% from 3.6% last month, suggesting three more rate hikes are on the way.
Lowe said the Australian economy could still be headed for a soft landing, especially if inflation and wage expectations remained subdued.
“But it’s also possible to stray from that narrow path,” he said.
The fact that the board meets monthly has provided frequent opportunities to assess how risks have changed and to be flexible, he added. – Reuters
