RBA Hikes Interest Rates to Near 15-Year High Amid Inflation Concerns

The Reserve Bank of Australia (RBA) raised interest rates by 25 basis points to a near 15-year high on Tuesday, citing growing inflationary risks due to high energy prices and tight domestic capacity.

The RBA's cash rate target is now at 4.60%, its highest level since October 2011. The decision was unanimous, with all members of the RBA's rate-setting board expressing concern over increasingly sticky inflation.

The central bank noted that recent Australian inflation data has been above the 2% to 3% annual target, and that some upside risks to inflation were materializing, including a prolonged conflict in the Middle East pushing up global energy prices.