KONTAN.CO.ID - SYDNEY. Australia's central bank tightened monetary policy this week because of upside inflation risks to an already drawn-out return of inflation to target, Governor Philip Lowe said on Wednesday, after raising interest rates to an 11-year high of 4.1%. Some further tightening may still be required to bring inflation to heel but that would depend on how the economy and inflation evolve, said Reserve Bank of Australia (RBA)'s Lowe said at the Morgan Stanley Australia Summit in Sydney. The RBA has projected headline inflation - which is at about 7% now - to return to the top of the bank's target of 2%-3% by mid-2025, a slower path than many other economies as Lowe wants to preserve strong gains in the labour market.
"It is too early to declare victory in the battle against inflation," said Lowe, conceding that the narrow path the central bank was trying to achieve - without crashing the economy into a recession - was likely to be bumpy. Baca Juga: US SEC Charges Crypto Platform Coinbase, One Day After Suing Binance "I want to make it clear, though, that the desire to preserve the gains in the labour market does not mean that the Board will tolerate higher inflation persisting." Price pressures have led the RBA to raise its cash rate by 400 basis points since last May, the most aggressive tightening campaign in modern history.
