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

Australia's central bank raised its benchmark interest rate for the fourth time this year on Tuesday, pushing borrowing costs to their highest level in nearly 15 years. The Reserve Bank of Australia lifted the cash rate by 25 basis points to 4.6 percent, matching market expectations.

The decision was unanimously backed by the nine-member board, which pointed out that inflation remained too high at 3.5 percent and that it wanted to ensure price pressures did not become entrenched across the economy.

Governor Michele Bullock has signaled in recent weeks that upside risks to inflation may be building, citing elevated energy prices and persistent excess demand as factors that could keep price growth elevated.

The rate decision comes at a politically sensitive moment for Prime Minister Anthony Albanese's government, which has struggled to convince voters it is addressing cost-of-living pressures. With the cash rate now at its highest since November 2011, Australia sits near the top of the developed world for policy rates, trailing only one other advanced economy.