Today the RBA raised the interest rate to 1.35%, a further 50 basis points from their rise in June 2022, marking its third monthly rate rise in a row.
As stated in Domain’s article today, in a statement following today’s decision, Mr Lowe said inflation was expected to peak later this year before settling into the Bank’s target 2 to 3 per cent range next year as global supply issues ease and higher interest rates temper demand. The board again reiterated its commitment to bringing inflation down, flagging further potential hikes in the coming months guided by incoming data.
Mr Lowe was also quoted saying, “but while the market is saying the rate will peak at four per cent, we believe it will be lower, at 2.1 per cent. We can already see higher interest rates having an impact on consumption, with house prices softening and CBA credit and debit card spending data indicating that consumer spending is beginning to moderate.”
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