The following are the significant highlights from the March Reserve Bank of Australia (RBA) monetary policy announcement, as given by Governor Philip Lowe.
It is steadfast in its effort to bring inflation back to target.
The Board anticipates that additional tightening of monetary policy will be required.
The monthly CPI index implies that inflation in Australia has peaked.
With increased demand for various services throughout the summer, service price inflation remained high.
The Board is attempting to bring inflation to the 2-3% target range while keeping the economy on track, but the route to a gentle landing remains tight. The Australian economy’s growth has slowed.
The timing and magnitude of the decrease in household expenditure are unpredictable.
Consumption in the home Because of tighter financial circumstances, growth has stalled.
Because of the uncertainties, there are several possible outcomes for the Australian economy.
The labor market remains extremely tight, while conditions have softened slightly.
Wage growth is picking up as a result of the tight labor market and increased inflation.
Latest statistics imply that the danger of a cycle in which prices and wages pursue each other is decreasing.
Yet, given the economy’s limited spare capacity and historically low unemployment rate, the Board is concerned about the potential of a price-wage spiral.
