RBA Keeps Interest Rates High as Inflation Remains Stubbornly Above Target

The Australian Bureau of Statistics released its latest consumer price index (CPI) on Wednesday, showing that both headline CPI and trimmed mean inflation remain above the Reserve Bank of Australia's target range.

In the 12 months leading up to August, headline CPI rose to 4.0%, up from 3.5% in July. Trimmed mean inflation, which many economists consider a better indicator of inflationary pressures, remained unchanged at 3.6%.

The news comes just one day after the Reserve Bank of Australia raised interest rates for the fourth time this year, bringing the official cash rate to 4.60%, its highest level since 2011.

RBA Governor Michele Bullock stated that the bank will not lower interest rates until inflation is back within the target band of 2% to 3%. She added that the bank may raise rates again this year if necessary, as it takes time for interest rate hikes to have their full effect on the economy.