At its meeting today, the RBA Board decided to maintain the cash rate target at 10 basis points - unchanged from where it has been since November 2020.
Governor Philip Lowe’s statement comments on how global activities including supply-side problems, international conflicts and the global pandemic are causing increases in inflation. “Inflation has increased in Australia, but it remains lower than in many other countries; in underlying terms, inflation is 2.6 per cent and in headline terms, it is 3.5 per cent. Higher prices for petrol and other commodities will result in a further lift in inflation over the coming quarters, with an updated set of forecasts to be published in May.”
“The Australian economy remains resilient and spending is picking up following the Omicron setback. Household and business balance sheets are in generally good shape, an upswing in business investment is underway and there is a large pipeline of construction work to be completed.”
“The strength of the Australian economy is evident in the labour market, with the unemployment rate falling further to 4 per cent in February. Underemployment is also at its lowest level in many years. Job vacancies and job ads are at high levels and point to continuing strong growth in employment over the months ahead. The RBA’s central forecast is for the unemployment rate to fall to below 4 per cent this year and to remain below 4 per cent next year.”
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