Australia's central bank lifts rates to 4.60%, signals more hikes
The Reserve Bank of Australia raised its cash rate by 25 basis points to a 15-year high of 4.60%, as expected. The board said inflation risks were materialising and it would increase the cash rate further if needed.
60% on Tuesday in its fourth hike of the year, saying inflation was too high and it was prepared to hike further if needed. 7014. Markets are now pricing in a 43% probability for another rate rise in November after the latest move. Wrapping up its September policy meeting, the Reserve Bank of Australia board voted unanimously to lift rates by 25 basis points, bringing the tightening this year to a full percentage point.
"Since the previous meeting, some of the upside risks to inflation are materialising," said the board. " "The Board will continue to do what it considers necessary to bring inflation sustainably back to target, including increasing the cash rate target further if needed," the board added. Markets had fully priced in a hike given inflation came in hotter than expected in July, oil prices had surged anew amid few signs of a resolution in the Gulf conflict, and policymakers had repeatedly warned that inflation risks could be materialising. Brent crude has climbed nearly 20% since the RBA last met in August, threatening a broadening of price pressures.
6%, data due on Wednesday are forecast to show. 8 billion), is adding to domestic demand. RBA Deputy Governor Andrew Hauser recently returned from the US more worried about inflation after having seen the AI-driven investment frenzy firsthand. The Uber Hawk The RBA's 100 basis points of tightening this year has more than reversed the 75 basis point of policy easing from 2025.
That leaves Australia ahead of much of the developed world. The US Federal Reserve this month delivered its first rate hike in more than three years, while the European Central Bank has raised rates twice this year. Australia's economy has slowed amid higher borrowing costs, but not enough to dispel inflation concerns. 1% in the second quarter, above the 2% speed limit the central bank believes can be sustained without generating inflation.
8%. The labour market is gradually easing but was still judged to be tight by the RBA. 6% only because more people entered the workforce. com; +61 0 427901124;)