RBA warns of possible further rate rises to combat inflation

Summarised from 2 outlets · Updated 13 Oct, 02:32 · Archive

Australia's Reserve Bank says it will raise interest rates further if needed to bring inflation under control.

The Reserve Bank of Australia has signalled it may raise interest rates further as it battles to control inflation. The RBA lifted the official cash rate by 25 basis points to 4.60 per cent following its September 28-29 meeting. This was the fourth interest rate hike in six meetings, taking the cash rate to its highest level since 2011.

Inflation stood at 3.5 per cent when the rate decision was made, above the RBA's target range of 2-3 per cent. The following day, new data showed headline inflation had worsened to 4.0 per cent, largely due to the ending of the government's temporary fuel excise tax cut.

RBA governor Michele Bullock acknowledged the hike was 'tough' for mortgage holders but said rates would need to go even higher unless inflation was lowered. According to minutes of the September meeting, the Reserve Bank board stated it would 'continue to do what it considered necessary to achieve that outcome, including increasing the cash rate target further if required'. The board says the Australian economy needs a period of below-trend growth to eliminate inflation pressures.

RBA warns of possible further rate rises to combat inflation — Image: Perth Now

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How it is being reported

RBA threatens further rate hikes if inflation continues to riseFrustrated mortgage holders are being warned the Australian economy needs to slow, otherwise there could be further interest rate pain.Perth Now · 13 Oct, 02:14
RBA threatens further rate hikes if inflation continues to riseFrustrated mortgage holders are being warned the Australian economy needs to slow, otherwise there could be further interest rate pain.The West Australian · 13 Oct, 02:14

In this story: Reserve Bank of Australia · Michele Bullock · Australia

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