RBA Raises Rates Again Over Inflation Fears, Braces for Impact on Households
• Concerns that businesses were passing on higher costs to consumers was a major factor prompting the RBA to raise interest rates again.
• RBA worried even a modest further increase in inflation expectations would make returning inflation to target more challenging.
• Financial pressures on households would be exacerbated by high inflation persisting longer than forecast.
• Higher interest rates having positive effects for some households, but still broadly dampening spending and impacting inflation.
• RBA will depend on incoming data for further tightening, but remains resolute on getting inflation back to 2-3% target range.