RBA Keeps Cash Rate at 4.35 Percent, Warns of Future Hikes

The Reserve Bank of Australia (RBA) has decided to keep its official cash rate at 4.35 percent, a decision that came as no surprise to financial markets.

However, RBA Governor Michele Bullock effectively ruled out any near-term interest rate cuts, warning that domestic inflation remains stubbornly entrenched.

Bullock stated during the post-meeting press conference in Sydney that 'the board did not discuss an interest rate cut at this meeting. It only discussed a raise or a stay,' further emphasizing the bank's hawkish stance.

The RBA's updated forecasts indicate that core inflation will not return to the midpoint of the 2-3 percent target range until late 2027, pushing any potential interest rate relief into the distant future.