Reserve Bank cools expectations of rise in interest rates

Original article by David Rogers
The Australian – Page: 13 & 20 : 9-Jul-21

Reserve Bank of Australia governor Philip Lowe has downplayed speculation that it could begin tightening monetary policy in 2022. Lowe has told the Economics Society of Queensland that inflation must be "sustainably" within the RBA’s target range of 2-3 per cent before it will consider a rise in the official interest rate; he added that wage growth of at least three per cent is likely to be needed for inflation to reach the central bank’s target range, while wages growth is "materially" less than three per cent at present. George Tharenou of UBS expects the RBA to abandon its bond yield target in the second half of 2022, which would enable it to increase the cash rate in 2023.


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