RBA Cracks Down on Inflation with Highest Rate Hike in 15 Years

Australia's central bank, the Reserve Bank of Australia, raised its key interest rate to a 15-year high on Tuesday. The cash rate was increased by 25 basis points to 4.6 per cent in an effort to curb inflation.

The main driver behind the decision is the prolonged war in the Middle East, which has led to higher global energy prices and contributed to inflationary pressures.

Economy Minister Jim Chalmers stated that 'Australians are paying a very hefty price for that war in the Middle East,' emphasizing the impact of the conflict on domestic costs.

The Reserve Bank also highlighted the role of artificial intelligence in driving up technology costs, which is adding to inflationary pressures.