RBA raises rates 25bp as spending falters
Outlook for household consumption uncertain as effects of tightening start to appear
The Reserve Bank of Australia added a further 25 basis points to its main interest rate today (May 2), taking it to 3.85%, as policy-makers signalled inflation was “still too high”.
Governor Philip Lowe said inflation was coming down, but the board decided higher rates were needed to return inflation to target “within a reasonable timeframe”. Australian inflation was 7% in the first quarter of 2023, down from 7.8% in the previous quarter. The RBA estimates it could take two years for inflation
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