RBA keeps interest rates steady, reiterates commitment to lower inflation
Investing.com-- The Reserve Bank of Australia kept interest rates steady on Tuesday, and said it remained committed to bringing down inflation, which it still saw as too high.
Longer-term inflation expectations remained within the bank’s forecasts, and the RBA said it was important that this remain the case. But the RBA said that while inflation was expected to fall in the near-term on government support, it did not see prices returning “sustainably” into its target range until 2026.
“The Board remains resolute in its determination to return inflation to target and will do what is necessary to achieve that outcome,” the RBA said in a statement.While strength in the labor market does present some signs of resilience in the Australian economy, it also heralds sticky inflation in the near-term.
Analysts at ANZ expect the bank to keep rates steady until at least the first quarter of 2025, and that any plans to begin cutting rates are likely to be delayed by sticky inflation and labor market strength.data due on Wednesday is expected to show inflation fell within the RBA’s 2% to 3% target range. But underlying inflation is expected to have remained high.
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