Following are the key headlines from the May RBA monetary policy statement, via Reuters, as presented by Governor Phillip Lowe.
It also increased the interest rate on exchange settlement balances from zero percent to 25 basis points.
Committed to doing what is necessary to ensure that inflation in Australia returns to target over time.
Board judged that now was the right time to begin withdrawing some of the extraordinary monetary support.
This will require a further lift in interest rates over the period ahead.
Board will continue to closely monitor the incoming information and evolving balance of risks as it determines the timing and extent of future interest rate increases.
Economy has proven to be resilient and inflation has picked up more quickly, and to a higher level, than was expected.
Media and markets briefing, including a question-and-answer session, will be held at 4pm.
Withdrawal of the extraordinary monetary support provided through the pandemic is appropriate.
Further rise in inflation is expected in the near term, but as supply-side disruptions are resolved, inflation is expected to decline back towards the target range of 2 to 3 per cent.
Board is not currently planning to sell the government bonds that the bank purchased during the pandemic.
Bank’s business liaison suggests that wages growth has been picking up.
Board does not plan to reinvest the proceeds of maturing government bonds.
Related reads
- AUD/USD tests 0.7140 as RBA elevates interest rates to 0.35%
- AUD/JPY rallies 75-pips on RBA’s more-than-expected rate hike
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
