Mon, 04 Dec 2023

SYDNEY, Oct. 3 (Xinhua) -- Reserve Bank of Australia (RBA) on Tuesday decided to leave the cash rate target unchanged at 4.10 percent for the fourth month in a row, with the interest rate paid on Exchange Settlement balances also steady at 4 percent.

Having hosted her first monetary policy meeting as the central bank's governor, Michele Bullock said in a statement that higher interest rates are working to establish a more sustainable balance between supply and demand.

Despite the fact that inflation in Australia is "still too high" and will remain so for some time, the governor underlined that recent data are consistent with the forecast of the Consumer Price Index (CPI) returning to its 2 percent to 3 percent target range in late 2025.

"Inflation is coming down, the labor market remains strong and the economy is operating at a high level of capacity utilization, although growth has slowed," said Bullock.

The RBA began a string of rate hikes in May last year, lifting the cash rate target from a record-low 0.1 percent to 4.10 percent in June this year.

After peaking at 7.8 percent in December last year, the annual CPI inflation dropped to 6 percent in the June quarter of 2023.

Meanwhile, according to the latest data released by the Australian Bureau of Statistics, the monthly Consumer Price Index indicator rose 5.2 percent in the 12 months to August 2023, up from 4.9 percent in July, but remained below the peak of 8.4 percent in December 2022.

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