- Prior 4.10%
- Middle East conflict has resulted in sharply higher fuel and commodity prices, which are already adding to inflation
- There are early signs that many firms are looking to increase prices of their goods and services
- There are materially heightened uncertainties about the outlook for domestic economic activity and inflation
- There are plausible scenarios where inflation is higher and activity lower than envisaged under the baseline forecast
- There are indications that Middle East conflict could lead to second-round effects on prices for goods and services more broadly
- Inflation is likely to remain above target for some time and that the risks remain tilted to the upside
- Having raised the cash rate three times, monetary policy is well placed to respond to developments
- Focused on mandate to deliver price stability and full employment
- Will do what it considers necessary to achieve that outcome
- Cash rate vote was 8-1
- Full statement
Coming into the meeting, traders were pricing in ~85% odds of a 25 bps rate hike with ~61 bps of rate hikes priced by year-end. More to come..
This article was written by Justin Low at investinglive.com.
