RBA Cash Rate Increases Having Intended Effect: Assistant Governor

RBA Assistant Governor Christopher Kent said that the central bank's cash rate increases are having their intended effect, signaling that policymakers view the current tightening cycle as broadly on track.

Kent pointed to the exchange rate as one channel through which policy is working, noting that a higher Australian dollar is helping to moderate inflation by lowering the domestic price of imports.

The Assistant Governor also highlighted the softening in housing market conditions, attributing it partly to tax changes announced in the federal budget.

He noted that substantial investment in data centres and AI-related infrastructure has helped support growth in aggregate demand, which is an offsetting force within the broader economy.