RBA Freezes Interest Rates at 4.35% Amid Ongoing Inflation Concerns

The Reserve Bank of Australia (RBA) has decided to keep the official interest rate at 4.35% after three consecutive increases since January. This decision was made by the RBA's Council, which cited that the current monetary policy is 'somewhat restrictive' and considered it appropriate to maintain the level of rates.

The RBA emphasized that inflation remains 'too high', with expectations that it will not return to the midpoint of the target range of 2%-3% until early 2028. The central bank noted that the disruption of global oil supply is directly contributing to inflation and that fuel prices are being passed on to other goods and services, keeping inflation high for some time.

The RBA warned that new increases in interest rates are not ruled out due to inflationary risks, which add to existing tensions on the productive capacity of the economy. The central bank's priority remains preventing high inflation from becoming entrenched permanently by containing aggregate demand and steering inflation towards the set target.