RBA Holds Steady, Warns Hike Possible Amid Soaring Inflation

The Reserve Bank of Australia (RBA) held its cash rate steady at 4.35 per cent for the second straight meeting on August 11, citing a slowing economy as expected.

The RBA warned that it might hike again if needed to control inflation, which is currently above the target band of 2-3 per cent.

Inflation data came in under forecasts in the second quarter, and the housing market has weakened more than policymakers had expected. However, consumer spending remained solid, and the labour market continued to produce jobs.

The RBA now expects inflation to ease back to its target band in the second half of next year, with a trimmed mean measure of underlying inflation remaining at 3.6 per cent.