Australian central bank raises benchmark interest rate from 1.85% to 2.35%

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The Central Bank of Australia (RBA) decided to raise the benchmark interest rate by 0.5 percentage point, from 1.85% to 2.35%, at its monetary policy meeting on Tuesday, 6 In the last interest rate hike, the monetary authority had already raised the rate by 50 basis points, from 1.35% to 1.85%. The RBA expects further rate hikes, albeit at different levels.

The size and timing of future rate hikes will be guided by data received and the Board’s assessment of the outlook for inflation and the labor market, RBA Chairman Philip Low said in a statement.

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Given the tight labor market and pricing pressures, the RBA will continue to pay close attention to labor cost developments and corporate pricing behavior in the coming period, the document says.

“Prospects for global economic growth have deteriorated due to pressures on incomes from high inflation, tightening of monetary policy in most countries, Russian invasion of Ukraine and Covid-19 containment measures and other policy challenges. in China”, evaluates Low.

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The central bank expects inflation to peak in Australia later this year and then fall back into the target range of between 2 and 3%. “The expected moderation in inflation reflects the ongoing resolution of global supply-side problems, the stabilization of commodity prices and the impact of rising interest rates,” says Low.

Source: CNN Brasil

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