Australia central bank sees risks of inflation picking up
Australia's central banker said upside risks to inflation may be materialising given sustained high energy prices and excess domestic demand, potentially supporting market wagers for a rate hike next week. Reserve Bank of Australia Governor Michele Bullock said unemployment around 4.5% to 5.0% could help restrain inflation, suggesting some rise might be needed from the current 4.5%. Bullock stressed she was not signalling rate policy, but highlighting risks from the Middle East conflict's impact on energy prices and domestic demand.
(Adds quote, background) SYDNEY, Sept 22 (Reuters) — Australia's top central banker said on Tuesday that upside risks to inflation may be materialising given energy prices have stayed high and there continued to be excess demand at home, underlining market wagers for a rate hike as soon as next week. 5%. Bullock said she was not trying to signal what might happen to rates when the nine-member RBA policy board met on September 29, but rather highlighting the upside risks to inflation. These included the conflict in the Middle East and its impact on energy prices, along with inflationary pressures from domestic demand.
" said Bullock. "The Middle East conflict has gone on now for much longer than people thought it would... " Bullock has repeatedly warned that the central bank's policy board was concerned that inflation had been too high for too long and risked getting baked into price-setting behaviour. Earlier on Tuesday, RBA Assistant Governor Sarah Hunter reiterated that interest rates might have to rise for a fourth time this year to ensure inflation was reined in.
35%. 6%, well above the RBA's target range of 2% to 3%. 85% early next year. net)