RBA governor Philip Lowe says the RBA Board has kept the cash rate steady for another month for a number of reasons.
He says the higher interest rates we have now are helping to establish a more sustainable balance between demand and supply in the economy.
In light of this, and the uncertainty surrounding the economic outlook, the Board wanted to have more time to see what impact these rate hikes were having on the economy.
"Inflation in Australia has passed its peak and the monthly CPI indicator for July showed a further decline," Dr Lowe said.
"But inflation is still too high and will remain so for some time yet. While goods price inflation has eased, the prices of many services are rising briskly. Rent inflation is also elevated.
"The central forecast is for CPI inflation to continue to decline and to be back within the 2–3 per cent target range in late 2025.
"The Australian economy is experiencing a period of below-trend growth and this is expected to continue for a while," he said.
"High inflation is weighing on people's real incomes and household consumption growth is weak, as is dwelling investment. "
"Notwithstanding this, conditions in the labour market remain tight, although they have eased a little.
"Given that the economy and employment are forecast to grow below trend, the unemployment rate is expected to rise gradually to around 4½ per cent late next year.
https://news.google.com/rss/articles/CBMiW2h0dHBzOi8vd3d3LmFiYy5uZXQuYXUvbmV3cy8yMDIzLTA5LTA1L2FzeC1tYXJrZXRzLWJ1c2luZXNzLWxpdmUtbmV3cy1zZXB0MDUtMjAyMy8xMDI4MTQyNDDSAShodHRwczovL2FtcC5hYmMubmV0LmF1L2FydGljbGUvMTAyODE0MjQw?oc=5
2023-09-05 07:42:07Z
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