Are Australians prepared for the possibility that the Reserve Bank won't hit its inflation target?
1 year, 7 months ago

Are Australians prepared for the possibility that the Reserve Bank won't hit its inflation target?

ABC  

One crucial aspect of a "target", as an idea, is that it's something you aim for. JP Morgan is openly stating that at this point, it's unclear if the Reserve Bank will hit its inflation target of between 2 and 3 per cent. Now it's entirely possible the Reserve Bank, whether or not it chooses to raise interest rates again, won't get inflation down to between 2 and 3 per cent in the foreseeable future. The Reserve Bank's inflation target is the driving force behind the bank's interest rates policy and affects just about every household in one way or another. The Reserve Bank may or may not increase interest rates again on Tuesday, but it's almost irrelevant what it does — the longer term financial outlook for households won't change much either way.

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History of this topic

Bank of England warns of ‘heightened uncertainty’ as it keeps interest rates on hold
5 days, 7 hours ago

Bank of England warns of ‘heightened uncertainty’ as it keeps interest rates on hold

Associated Press  

LONDON — The U.K.’s central bank warned Thursday of “heightened uncertainty” as it kept interest rates on hold after inflation moved further above target, even at a time when the British economy is flatlining at best. The Bank of England’s nine-member Monetary Policy Committee kept its main interest rate unchanged at 4.75% with new data showing inflation rising to 2.6%, …

DC Edit | Will RBI tweak inflation focus?
1 week, 6 days ago

DC Edit | Will RBI tweak inflation focus?

Deccan Chronicle  

The appointment of Sanjay Malhotra as the new RBI governor continues the long-standing tradition of IAS officers heading the Central bank, a quasi-autonomous body that decides the country’s monetary policy. Mr Malhotra took over the charge of RBI from Shaktikanta Das — the second longest serving governor after Sir Benegal Rama Rau’s stint of seven years and 197 days — …

Inflation set to stay above 2% for next four years, says OBR
1 month, 3 weeks ago

Inflation set to stay above 2% for next four years, says OBR

The Independent  

For free real time breaking news alerts sent straight to your inbox sign up to our breaking news emails Sign up to our free breaking news emails Sign up to our free breaking news emails SIGN UP I would like to be emailed about offers, events and updates from The Independent. Read our privacy policy UK inflation is set to …

PETER VAN ONSELEN: Which of these statements about the Australian economy is true? 1) Australia has won the war on inflation 2) Interest rates are too high 3) The country is run by a bunch of muppets
3 months ago

PETER VAN ONSELEN: Which of these statements about the Australian economy is true? 1) Australia has won the war on inflation 2) Interest rates are too high 3) The country is run by a bunch of muppets

Daily Mail  

I used to enjoy a good muppet show as a kid, but the muppet show we'll see tomorrow when the latest inflation data gets revealed will be far less edifying. RBA Governor Michele Bullock will see through tomorrow's headline inflation figure And that underlying figure will be higher than the top end of the Reserve Bank's target range. The underlying …

These numbers are the clues to the Reserve Bank's puzzle: when will interest rates go down?
3 months ago

These numbers are the clues to the Reserve Bank's puzzle: when will interest rates go down?

ABC  

Perhaps no question matters more to Australians worn down by three years of relentless cost pressures: when will the Reserve Bank cut interest rates? But not too much – which is why when inflation shoots high, the Reserve Bank raises interest rates to suppress demand by making it more expensive to borrow and spend. But the Reserve Bank prefers a …

Why headline inflation numbers are masking the confronting financial reality facing many households
4 months, 2 weeks ago

Why headline inflation numbers are masking the confronting financial reality facing many households

ABC  

There won't be protest marches in the streets when the Reserve Bank of Australia makes its next decision on interest rates. In the lead-up to Wednesday's inflation reading for the June quarter, there was speculation that if it came in hot, above 4 per cent, a rate rise would be on the cards. In the end, the "headline" annual rate …

PETER VAN ONSELEN: Jim Chalmers' excuses for Australia's inflation crisis spectacularly unravel - with two key stats easily blowing apart the garbage Treasurer is peddling
4 months, 3 weeks ago

PETER VAN ONSELEN: Jim Chalmers' excuses for Australia's inflation crisis spectacularly unravel - with two key stats easily blowing apart the garbage Treasurer is peddling

Daily Mail  

Treasurer Jim Chalmers wants you to believe that rising inflation isn't his fault. Under pressure: Jim Chalmers' excuses for Australia's 'sticky' inflation crisis are unravelling He wants you to focus on the fact inflation is lower now than when Labor came to power. In other words Australia's rising inflation - a quarterly adjusted figure of 3.8 per cent - is …

Why the Reserve Bank of Australia should hold off on interest rate hikes in August
4 months, 3 weeks ago

Why the Reserve Bank of Australia should hold off on interest rate hikes in August

ABC  

There's a curious thing about openness, communication and transparency. Because, despite recently showing a real reluctance to want to push interest rates even higher, she and her Reserve Bank of Australia colleagues have for the past two years made it abundantly clear that they were committed to hammering inflation into submission. Money markets right now have just a one-in-five chance …

RBA Sees Some Households Struggling, Suggesting Rate-Hike Limits
6 months, 3 weeks ago

RBA Sees Some Households Struggling, Suggesting Rate-Hike Limits

Live Mint  

-- Australia’s inflation is showing persistent strength and weighing heavily on the finances of some households, a senior Reserve Bank official said, highlighting the limits to further interest-rate increases. “The board are absolutely focused on the fact that inflation is clearly still above the target band,” RBA Assistant Governor Sarah Hunter said at a conference in Sydney on Thursday, referring …

Why further interest rate hikes by the Reserve Bank won't fix Australia's inflation problem
7 months, 2 weeks ago

Why further interest rate hikes by the Reserve Bank won't fix Australia's inflation problem

ABC  

If only there was a diagnosed condition called One Size Fits All syndrome. That's helped push one measure of price rises — core inflation — higher on a quarterly measure. Quick as a flash, that's sparked a renewed demand from some sections of the economics commentariat for further rate hikes to smash the evils of inflation once and for all. …

Australia's economic crisis will be front and centre as 2023 ends. But whether 2024 will be more prosperous remains to be seen
1 year ago

Australia's economic crisis will be front and centre as 2023 ends. But whether 2024 will be more prosperous remains to be seen

ABC  

It's been a year, hasn't it? That inflation struggle will be front and centre as this year ends and the new year begins, keeping the Reserve Bank back in the national economic driver's seat for another year. Unemployment rises despite another surprise job creation surge Photo shows A female bartender smiles at a colleague cutting lemons as she shakes up …

Reserve Bank leaves interest rates on hold in an early Christmas present for borrowers - but here's why Aussies with mortgages should be worried
1 year ago

Reserve Bank leaves interest rates on hold in an early Christmas present for borrowers - but here's why Aussies with mortgages should be worried

Daily Mail  

Australian borrowers have been warned to expect another rate hike even though the Reserve Bank has this month left interest rates on hold. The cash rate is already at a 12-year high of 4.35 per cent after the RBA last month raised rates for the 13th time in 18 months. KPMG chief economist Brendan Rynne said the Reserve Bank statement …

Michele Bullock: The one glaring word missing from Reserve Bank boss' speech as she says inflation crisis is 'homegrown' - and issues a grim warning about interest rates to Australians
1 year, 1 month ago

Michele Bullock: The one glaring word missing from Reserve Bank boss' speech as she says inflation crisis is 'homegrown' - and issues a grim warning about interest rates to Australians

Daily Mail  

Reserve Bank governor Michele Bullock has warned Australia's skyrocketing inflation is a 'homegrown' issue but failed to address concerns that increased immigration is worsening the crisis. Reserve Bank governor Michele Bullock admitted Australia's skyrocketing inflation is a 'homegrown' issue The RBA is considering ways to bring Australia's inflation, currently running at 5.4 per cent, back to its 2 to 3 …

Michele Bullock says RBA 'will not hesitate' to increase rates if inflation takes longer than expected to return to target
1 year, 2 months ago

Michele Bullock says RBA 'will not hesitate' to increase rates if inflation takes longer than expected to return to target

ABC  

Reserve Bank of Australia governor Michele Bullock says the central bank "will not hesitate" to increase the cash rate over fears inflation could take longer to return to target than its current "late 2025" forecast. Key points: The RBA has left the cash rate on hold at 4.1 per cent since June as inflation began to ease But governor Michele …

Companies chasing profits amid high inflation risks an Australian recession, RBA warns
1 year, 6 months ago

Companies chasing profits amid high inflation risks an Australian recession, RBA warns

ABC  

The Reserve Bank has pointed directly to the inflation elephant in the room — that "some" companies are indeed helping to drive inflation with aggressive price increases. Today, for the first time, the Reserve Bank referenced that “some firms” were lifting their prices past levels of inflation, in effect locking those previous price rises into future pricing and making the …

RBI holds rates but signals tight monetary policy ahead
1 year, 6 months ago

RBI holds rates but signals tight monetary policy ahead

Hindustan Times  

India's central bank kept its key lending rate steady for a second straight policy meeting on Thursday, as widely expected, but signalled that monetary conditions will remain tight for some time as it looks to further curb inflationary pressures. The RBI maintained its policy stance of "withdrawal of accommodation" to ensure inflation progressively aligns with the committee's target while remaining …

Businesses are fuelling inflation with unnecessary price hikes — and struggling Australians are paying for it
1 year, 10 months ago

Businesses are fuelling inflation with unnecessary price hikes — and struggling Australians are paying for it

ABC  

Higher prices, that is. The Reserve Bank summed this up in this week's Monetary Policy Decision: "Global factors explain much of this high inflation, but strong domestic demand is adding to the inflationary pressures in a number of areas of the economy." "There's no doubt that corporations have taken advantage of the supply chain problems and the desperation of consumers …

Reserve Bank warns of at least two more interest rate rises in coming months, as the economic outlook worsens
1 year, 10 months ago

Reserve Bank warns of at least two more interest rate rises in coming months, as the economic outlook worsens

ABC  

Australia's cash rate has hit 3.35 per cent, after the Reserve Bank raised interest rates for the ninth time in a row — and signalled more interest rate pain ahead. That was the view of traders in the money market, who had priced loans on the basis that the bank's cash rate would climb just 0.35 points further after being …

Reserve Bank raises interest rates, 'expects that further increases will be needed'
1 year, 10 months ago

Reserve Bank raises interest rates, 'expects that further increases will be needed'

ABC  

The Reserve Bank has raised interest rates for the ninth meeting in a row, taking the cash rate target to its highest level since September 2012. Key points: The RBA's cash rate target is now at 3.35 per cent That is the highest level of the cash rate since September 2012 The RBA governor indicates that further rate rises are …

What is the target level of inflation?
2 years, 1 month ago

What is the target level of inflation?

The Hindu  

The story so far: India’s retail inflation dropped to a three-month low of 6.77% in October when compared to the same month last year. Hence, it may be hard to compare inflation figures of the current year, in which normalcy has largely returned to the economy, with those from previous years marred by stringent lockdowns. Retail inflation at 6.77% is …

Reserve Bank' admits higher interest rates WON'T bring down inflation
2 years, 1 month ago

Reserve Bank' admits higher interest rates WON'T bring down inflation

Daily Mail  

The Reserve Bank has admitted hiking interest rates aggressively doesn't necessarily bring down inflation quickly. Australia inflation grew by 7.3 per cent in the year to September at levels unseen since 1990 The Reserve Bank's statement on monetary policy released earlier this month forecast annual inflation remaining above its target until 2025, after falling to 3.25 per cent in December …

No need to change inflation target of 2-6%; October print to be lower than 7%: RBI Governor
2 years, 1 month ago

No need to change inflation target of 2-6%; October print to be lower than 7%: RBI Governor

The Hindu  

RBI Governor Shaktikanta Das on November 12 said there was no need to change the inflation target despite the Central bank's failure to keep it below the 6% upper tolerance level for nine consecutive months while exuding confidence that the October print will be less than 7 %. Speaking at the HT Leadership Summit on Saturday, Mr. Das said there …

Reserve Bank of Australia rejects 'scorched earth' policy to tame inflation with faster interest rate rises
2 years, 1 month ago

Reserve Bank of Australia rejects 'scorched earth' policy to tame inflation with faster interest rate rises

ABC  

Reserve Bank of Australia deputy governor Michele Bullock has said the bank wants to hang on to as much of the employment gains made during the pandemic as it can, even as it tries to cool the economy to tame inflation. Key points: RBA deputy governor says a "scorched earth" policy of rapid interest rate hikes would crush inflation quickly …

Australia has a problem with inflation, and that likely means more interest rate hikes to come
2 years, 1 month ago

Australia has a problem with inflation, and that likely means more interest rate hikes to come

ABC  

Australia has a problem with inflation. It's a judgement call The Reserve Bank's inflation fighting job would be a heck of a lot easier if there wasn't such a time lag between cause and effect — that is, raising interest rates and seeing prices come down. But the Reserve Bank's key objective of lowering inflation back to the target range …

The Australian Greens say the Reserve Bank needs to be more democratically accountable
2 years, 1 month ago

The Australian Greens say the Reserve Bank needs to be more democratically accountable

ABC  

The Reserve Bank and the federal government need to jointly deploy inflation policy, using different tools to overcome different outbreaks of inflation, the Australian Greens say. Key points: The Reserve Bank should be helping to direct the flow of credit in Australia's economy to more productive ends It should help governments to transition to a low emission economy Monetary policy …

Reserve Bank warns Australians to brace for tough years ahead to get inflation under control
2 years, 1 month ago

Reserve Bank warns Australians to brace for tough years ahead to get inflation under control

ABC  

The Reserve Bank expects a couple of tough years for Australians, with real wages continuing to fall as inflation persists and unemployment starts to rise. Key points: RBA raises its inflation forecasts, with a peak of 8 per cent in December with the CPI still growing at 3.2 per cent at the end of 2024 Wages growth is expected to …

Missed inflation target, but acting early would have exerted heavy costs: RBI Das
2 years, 1 month ago

Missed inflation target, but acting early would have exerted heavy costs: RBI Das

Deccan Chronicle  

Mumbai: RBI Governor Shaktikanta Das on Wednesday defended the Reserve Bank's handling of the price situation, saying acting prematurely on inflation would have exerted a heavy cost on the economy and citizens. Acknowledging that the inflation target has been missed, Das said the RBI decided to support the economy by not introducing a rate hike in face of a spike …

Will Australian policymakers ever want to see strong wage growth again?
2 years, 1 month ago

Will Australian policymakers ever want to see strong wage growth again?

ABC  

One of the joys of life is thinking about things in a way you're not supposed to, and that includes questioning the orthodoxy. It also contained some comments from Mr Jericho about Australia's "inflation-targeting" regime that has been in place since 1993. Who does inflation targeting really serve? "Inflation targeting in Australia since 1993 has not been neutral," Mr Jericho …

ASX slumps, Wall St suffers biggest falls since 2020 after US inflation shock
2 years, 3 months ago

ASX slumps, Wall St suffers biggest falls since 2020 after US inflation shock

ABC  

Around $60 billion has been wiped off the value of Australian shares after US inflation rose faster than expected in August, prompting fears of more aggressive interest rate rises by the US central bank. Key points: The Dow Jones index fell 3.9pc to 31,105, the S&P 500 index lost 4.3pc to 3,933, while the Nasdaq Composite fell 5.2pc to 11,634 …

RBI Bulletin: India's Inflation Still Elevated, May Need Monetary Policy Response
2 years, 4 months ago

RBI Bulletin: India's Inflation Still Elevated, May Need Monetary Policy Response

ABP News  

India’s inflation may still require a monetary policy response going forward as it remains above the target range even though it has eased in recent months, the Reserve Bank of India said in the monthly bulletin released on Thursday. The RBI said, “Inflation has edged down, but its persistence at elevated levels warrants appropriate policy responses to anchor expectations going …

Reserve Bank of Australia hikes interest rates by 0.5 percentage points
2 years, 4 months ago

Reserve Bank of Australia hikes interest rates by 0.5 percentage points

Daily Mail  

The Reserve Bank of Australia has raised the cash rate by half a percentage point with governor Philip Lowe hinting at further increases to tame the worst inflation in two decades. This would see someone paying off an average $600,000 mortgage cop a $169 increase in their monthly mortgage repayments In a statement, Dr Lowe said the RBA would struggle …

Reserve Bank governor Philip Lowe warns it is unclear how high interest rates will go
2 years, 6 months ago

Reserve Bank governor Philip Lowe warns it is unclear how high interest rates will go

ABC  

The Reserve Bank governor has warned Australians they need to be prepared for substantial interest rate rises over the rest of this year, conceding he is not sure how high they might go. Key points: Philip Lowe says it is "reasonable" to think interest rates will get to 2.5 per cent at some point He expects inflation could reach 7 …

Reserve Bank of Australia warning of more interest rate rises as inflation soars
2 years, 7 months ago

Reserve Bank of Australia warning of more interest rate rises as inflation soars

Daily Mail  

Australian home borrowers are expected to be hit with an even bigger interest rate rise in June as inflation soars at an even faster pace than anticipated. Australian home borrowers are expected to be hit with an even bigger interest rate rise in June as inflation soars at an even faster pace than anticipated On Friday the 13th last week, …

How much THIS 0.25 percentage point interest rate rise will cost you
2 years, 7 months ago

How much THIS 0.25 percentage point interest rate rise will cost you

Daily Mail  

Data based on variable rate increasing from 2.29 per cent to 2.54 per cent Read articles that feature this panel Rate rise, what rate rise? Three of the Big Four pass on the FULL interest rate rise after the Reserve Bank stunned homeowners with a quarter of a per cent hike - the. How the Reserve Bank misled Australia by …

Is the Reserve Bank doing enough to rein in inflation? | The Hindu Parley podcast
2 years, 8 months ago

Is the Reserve Bank doing enough to rein in inflation? | The Hindu Parley podcast

The Hindu  

India’s inflation, which is measured by the Consumer Price Index, has stayed above the Reserve Bank of India ’s upper tolerance limit of 6% for three months running. The central bank’s monetary policy committee decided to hold benchmark interest rates earlier this month, choosing to remain accommodative “while focussing on withdrawal of accommodation to ensure that inflation remains within the …

Is the Reserve Bank doing enough to rein in inflation?
2 years, 8 months ago

Is the Reserve Bank doing enough to rein in inflation?

The Hindu  

India’s inflation, which is measured by the Consumer Price Index, has stayed above the Reserve Bank of India ’s upper tolerance limit of 6% for three months running. The central bank’s monetary policy committee decided to hold benchmark interest rates earlier this month, choosing to remain accommodative “while focussing on withdrawal of accommodation to ensure that inflation remains within the …

Why Australia's Reserve Bank won't hike interest rates just yet
2 years, 9 months ago

Why Australia's Reserve Bank won't hike interest rates just yet

ABC  

The biggest question relating to the management of the economy right now has nothing to do with next week's budget. When inflation climbs above 3 per cent the board hikes interest rates to bring it back down to somewhere within the bank's target band of 2-3 per cent. Here's how the bank itself puts it: If the economy is growing …

Inflation triggered an interest rate rise in the US. That could lead to mortgage shock in Australia
2 years, 9 months ago

Inflation triggered an interest rate rise in the US. That could lead to mortgage shock in Australia

ABC  

Heather Somerstein moved to Atlanta from New York City three years ago, partly in search of a more affordable lifestyle. Although the Reserve Bank doesn't need to follow the Federal Reserve in hiking rates, it often takes cues from its US counterpart, says former Federal Reserve Bank of Atlanta President Dennis Lockhart. "Every central bank makes its own decision based …

Inflationary tsunami leaves the Bank of England high and dry
2 years, 10 months ago

Inflationary tsunami leaves the Bank of England high and dry

The Telegraph  

Bank of England Governor Andrew Bailey is getting used to testy exchanges with his scrutineers in Westminster as inflation rockets to 30-year highs. The latest came at the central banker’s recent appearance before MPs on the Treasury Select Committee, when chairman Mel Stride bluntly referred to a “judgment call that you got wrong” as the Bank held off on raising …

Inflation is not 'out of control', but interest rates may have to rise this year
2 years, 10 months ago

Inflation is not 'out of control', but interest rates may have to rise this year

ABC  

Australian consumers saw prices rise by 3.5 per cent last year. Inflation running at 3.5 per cent Most of the price increases facing consumers in Australia last year were driven by pandemic-related economic disruptions. Gareth Aird, a Commonwealth Bank economist, says Australia's labour market will keep tightening this year, meaning even more people will find jobs and the unemployment rate …

Former treasurer Peter Costello blames Reserve Bank of Australia for house price rises
3 years, 1 month ago

Former treasurer Peter Costello blames Reserve Bank of Australia for house price rises

Daily Mail  

Australia's longest-serving treasurer has blamed the Reserve Bank for the extraordinary surge in house prices across the country. Scroll down for video Australia's longest-serving treasurer has blamed the Reserve Bank for the ridiculous surge in house prices Dr Lowe has since indicated interest rates could rise in 2023 but he ruled out raising the cash rate early to cool an …

RBI says inflation is on track to meet projections
3 years, 4 months ago

RBI says inflation is on track to meet projections

Live Mint  

Inflation is likely to remain within the Reserve Bank of India's projected levels for the rest of the year, it said on Tuesday while highlighting that inflation containment comes at the cost of economic growth. Earlier this month the RBI raised its 2021/22 inflation forecast to 5.7% from 5.1% and reiterated that it will continue to keep monetary policy accommodative …

Inflation 'rebirth' threatens low interest rates even as Reserve Bank holds the line
3 years, 6 months ago

Inflation 'rebirth' threatens low interest rates even as Reserve Bank holds the line

ABC  

The Reserve Bank has reaffirmed its commitment to keeping the official cash rate close to zero for years, despite signs of rising inflation around the world, particularly in the United States. Key points: The RBA says "monetary policy will need to remain highly accommodative for some time yet" Capital Economics says there is a "fundamental concern" that the low inflation …

Reserve Bank of Australia leaves interest rates on hold for April 2021, borrowers expect early rise
3 years, 8 months ago

Reserve Bank of Australia leaves interest rates on hold for April 2021, borrowers expect early rise

Daily Mail  

Record-low interest rates are a ticking time bomb for one million home borrowers amid fears mortgage costs will go up well before 2024. The Reserve Bank of Australia on Tuesday left the cash rate on hold at a record low of 0.1 per cent but governor Philip Lowe has acknowledged rapidly rising house prices were a concern. Pictured is a …

The Hindu Explains | What are the implications of the Finance Ministry’s decision for monetary policy?
3 years, 8 months ago

The Hindu Explains | What are the implications of the Finance Ministry’s decision for monetary policy?

The Hindu  

The story so far: On the last day of the financial year 2020-21, the Finance Ministry announced that the inflation target for the five years between April 2021 and March 2026 will remain unchanged at 4%, with an upper tolerance level of 6% and a lower tolerance level of 2%. This is the retail inflation target that will drive the …

RBI favors retaining inflation target regime
3 years, 9 months ago

RBI favors retaining inflation target regime

Hindustan Times  

The Reserve Bank of India favors keeping the current inflation targeting regime unchanged, saying it has been effective in containing price-growth. The current framework is appropriate for the next five years, according to a report from the RBI on Friday, after it reviewed the flexible inflation targeting regime, or FIT, put in place five years ago. While the central bank …

Federal Reserve's inflation target fudge: what it means for Australians
4 years, 3 months ago

Federal Reserve's inflation target fudge: what it means for Australians

ABC  

Late last week, the chairman of the US central bank announced major changes to the way the US will be targeting inflation in coming years. Instead of trying to keep inflation around 2 per cent by lowering or raising interest rates, Fed chairman Jerome Powell said the US central bank might let things run a bit hot for a while …

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