The Reserve Bank of Australia (RBA) has indicated that inflation expectations remain anchored, although market premia have drifted higher. Recent data have not been sufficient to alter the outlook for inflation returning to target by 2026. The RBA believes it is still possible to bring inflation to target while maintaining employment gains. However, the central bank has emphasized the need to be vigilant about upside risks to inflation, particularly with data suggesting an upside risk for the May Consumer Price Index (CPI). A significant rise in inflation expectations could necessitate considerably higher interest rates.
RBA: A MATERIAL RISE IN INFLATION EXPECTATIONS COULD REQUIRE SIGNIFICANTLY HIGHER RATES
RBA: INFLATION EXPECTATIONS STILL ANCHORED, BUT MARKET PREMIA HAD DRIFTED HIGHER
RBA: JUDGED STILL POSSIBLE TO BRING INFLATION TO TARGET WHILE KEEPING EMPLOYMENT GAINS
RBA: RECENT DATA NOT SUFFICIENT TO CHANGE OUTLOOK FOR INFLATION RETURNING TO TARGET BY 2026
RBA: NEEDED TO BE VIGILANT TO UPSIDE RISKS TO INFLATION, DATA SUGGESTED UPSIDE RISK FOR MAY CPI
RBA - a material rise in inflation expectations could require significantly higher rates https://t.co/VPlmijiu5q
The odds of another RBA interest-rate hike have gone up because of persistent inflation. Read today's Australia Briefing by @amy_bainbridge for your daily dose of the best of Bloomberg from Down Under and around the world. https://t.co/5SD8fpN7jH
#InterestRates #Australia going the other way. Australia’s central bank is on track to hike rates after #inflation came in well above expectations