MADRID, 5 Sep. (EUROPA PRESS) –
The Reserve Bank of Australia, the body in charge of the monetary policy of the oceanic country, has decided to keep interest rates at 4.10% on Tuesday, at the highest since April 2012, although it has warned that it may be necessary to raise the rate further to bring inflation back to the 2%-3% target within a reasonable period of time.
In statements after the meeting of the Council of the Australian central bank, the governor of the entity, Philip Lowe, explained that the decision to keep interest rates unchanged this month was intended to give the institution more time to assess the impact of tightening the monetary policy undertaken to date and the economic outlook.
Australia has raised interest rates by 400 basis points since May of last year in response to sharply rising inflation. The central forecast is for the CPI to continue declining and return to the target range of 2%-3% by the end of 2025.
The central bank considers that inflation “remains too high and will remain so for some time, impairing the functioning of the economy, eroding the value of savings and worsening income inequality”, so its priority is bring inflation back to target within a reasonable time frame.
“Further monetary policy tightening may be necessary to ensure that inflation returns to target within a reasonable time frame, but this will continue to depend on data and risk assessment. (…) The Council remains firm in its determination to bring inflation back to target and will do what is necessary to achieve it,” Lowe warned.
