The Reserve Bank of Australia(RBA) is committed to doing all it takes to ensure that inflation returns to target over time.

Governor Phillip Lowe presents the following vital headlines from the May RBA monetary policy statement through Reuters.

May 03, 2022 - 12:19 PM 231 views

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Governor Phillip Lowe presents the following vital headlines from the May RBA monetary policy statement through Reuters.

·        It also hiked the interest rate on exchange settlement balances from 0% to 25 bps.

·        We are committed to taking the necessary actions in order to achieve the Australian inflation rate reaching the target on time.

·        The board anticipated that it was the correct time to squeeze the best monetary support.

·        This needs an additional increase in interest rates over the period of time.

·        In order to determine the timing and extent of future interest rate hikes, the board will likely continue to watch the incoming information and evolution of the risk balances.

·        The economy has proved to be highly resistant and inflation rates have quickly picked up to a higher level than expected.

·        As per the media and market briefing, a question and answer session is going to be held at 4:00 P.M.

·        It is relevant to withdraw the extraordinary monetary support system that was provided during the pandemic.

·       Inflation rates are likely to increase in the future, but when the supply-side disruptions are resolved, inflation is likely to decrease backwards towards the target range of 2-3%.

·       The board is not willing to sell the government bonds that were purchased during the pandemic period.

·        Labor wage growth has been increased, which was suggested by the bank’s business liaison.

·        Currently, the board is not planning to reinvest in the maturing government bonds.

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