Rates Remain On Hold
The RBA has left interest rates on hold for the third straight month.
While interest rates remain at 4.1%, the RBA has flagged potential further increases may be needed to ensure inflation remainsunder control.
Inflation dropped to 4.9% in July – lower than was initially expected but still higher than the RBA’s target range of 2% to 3%.
Outgoing RBA governor, Philip Lowe says although inflation is declining, more may need to be done to curb inflation further.
“Some further tightening of monetary policy may be required to ensure that inflation returns to target in a reasonable time frame,but that will continue to depend upon the data and the evolving assessment of risks,” he says.
He says the RBA decided not to move on rates in September as higher interest rates are having an impact on inflation.
It predicts inflation will return to the target range by late 2025 and unemployment will rise gradually to reach 4.5% by late 2024.