RBA raises cash rate 50bps to 0.85%

By Sophia Rodrigues

Published On 07 Jun 2022 , 02:47 PM

The Reserve Bank of Australia raised the cash rate target by 50bps to 0.85%. The rate on Exchange Settlement balances was also raised by 50bps to 0.75%.

Key headlines:
--Expects to take further steps in policy normalization
--Committed to do what is necessary
--Inflation has increased significantly. Higher than earlier expected
--Terms of trade at record high
--Higher electricity, gas prices means near-term inflation is likely to be higher than expected a month ago
--Upswing in business investment
--Household spending one source of uncertainty…will pay close attention
--Econ resilience and higher inflation means extraordinary monpol support no longer needed
--Size and timing of future rate increase to be guided by incoming data

 

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