RBA governor Bullock reaffirms that the central bank will raise interest rates again if needed
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Bullock is commenting in her press conference: We only considered holding rates and a 25 bps rate hike as our options today Will raise interest rates again if needed Inflationary pressures to last longer than expected Inflation is driven by domestic capacity pressures One upside
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The desk interprets RBA Governor Bullock's recent comments as a clear signal that the central bank is prioritizing inflation control amidst external shocks. Per the full note [source], Bullock emphasized the need for vigilance against inflation expectations, suggesting that if second-round effects from current geopolitical tensions manifest, even higher rates may be necessary. This aligns with our view that the RBA's current cash rate, described as somewhat restrictive, leaves room for further adjustments depending on economic developments. The consensus among analysts suggests a cautious approach, with a focus on upcoming data releases to gauge the inflation trajectory.
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