Australia's Central Bank Warns of Inflation Risks Amid High Energy Prices

Australia's central bank governor Michele Bullock has warned that upside risks to inflation may be materializing, citing high energy prices and excess demand at home.

Bullock made these remarks during a business lunch on Tuesday, stating that the Middle East conflict has had a prolonged impact on energy prices, which is contributing to inflationary pressures.

The Reserve Bank of Australia (RBA) has increased the cash rate by 75 basis points since February, taking it back to a post-pandemic high of 4.35%. However, core inflation remains at 3.6%, above the RBA's target range of 2% to 3%.

RBA Assistant Governor Sarah Hunter echoed Bullock's concerns, suggesting that interest rates might have to rise for a fourth time this year to rein in inflation.