RBA Governor Bullock says rates high enough, focus on inflation
2024.11.13 19:30
Investing.com– Reserve Bank of Australia Governor Michele Bullock said on Thursday that interest rates were restrictive enough, and will remain at current levels until the central bank was confident that inflation was easing.
Speaking at the ASIC Annual Forum in Sydney, Bullock said uncertainty over the U.S. economic outlook would keep the bank cautious. She flagged the risk of potentially inflationary policies under Donald Trump.
Bullock’s comments furthered bets that Australian interest rates will not rise any further, following similar messaging by the RBA during its recent meetings.
“We’re not as restrictive as others (central banks), even as they are lowering their interest rates. We think we’re restrictive enough, and we’re going to stay restrictive enough until we think we’ve definitely got that downward trajectory in demand,” Bullock said.
The RBA kept its unchanged at 4.35% last week,marking a year since the central bank last raised rates.
While the RBA said inflation had cooled in line with its expectations, price pressures still remained high, and interest rates would need to remain steady until it was more confident that inflation risks had abated.
The RBA also signaled that it was not ruling anything in or out with regards to future policy decisions.
Analysts at ANZ and Westpac said that the RBA was likely to begin cutting rates by the first quarter of 2025, although any upside risks in inflation were likely to delay the cut.
Australian eased in the September quarter, but still remained above the RBA’s 2% to 3% target range.
